Source: The Canadian Press
A survey by a pension advisory firm says the value of Canadian pension funds plummeted in the third quarter.
The Mercer Pension Health Index fell to 60% at the end of September, down from 71% in June.
The index indicates a model fund’s holdings were worth only 60% of its long-term obligations to retirees at the end of the quarter.
The value of pension plans varies widely from one quarter to the next, and do not immediately affect the payouts made to retirees.
During the most recent quarter, heightened fears over European debt led to huge losses on global stock markets and drove bond yields lower.
The Toronto Stock Exchange fell 12% during the quarter, which took three per cent from the pension index, while bond yields fell 80 basis points, which pushed the index down eight per cent.