As schemes negotiate the ongoing fallout from the mini-budget, we look at what the gilts market volatility means for DB pension schemes and the practical actions to consider.

Gilt yields have been rising at an unprecedented rate throughout 2022. However, in the days following the mini-budget, the speed and scale of yield rises placed immense pressure on many DB schemes to meet urgent collateral calls on leveraged LDI programmes. Although yields have fallen back since the subsequent Bank of England intervention, they still remain at the highest levels for a decade.

In the aftermath, attention should be turning to reviewing funding positions, collateral sufficiency, investment strategies and endgame journey plans. With rising interest rates also impacting the value of member options like transfer values and commutation, there’s plenty for trustees and sponsors to be working through in the weeks ahead.

Download our latest paper to read our brief guide to the key actions to consider

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If you have any questions on anything covered, please get in touch.