Article on Liability-Driven Investing published in Employee Benefits News Canada

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LDI Helps Pension Funds Weather the Storm

Article by Tony Williams, President at PBI Actuarial Consultants Ltd., published in Employee Benefits News.

Extract:

Pension funds that are currently underfunded on either a going-concern or a solvency basis due to the unraveling of global capital markets since August 2007 should seriously consider liability-driven investing to immunize them from market volatility.

Although the current unprecedented financial crisis has affected all investors, some pension funds that follow a liability-driven investment and funding strategy have successfully maintained their funded position.

For example, the Teamsters Canadian Pension Plan has subscribed to an LDI strat­egy for more than 10 years, and TCPP results to the end of 2007 reveal the pension fund is in a strong financial position.

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