Disclaimer: Views in this blog do not promote, and are not directly connected to any Legal & General Investment Management (LGIM) product or service. Views are from a range of LGIM investment professionals and do not necessarily reflect the views of LGIM. For investment professionals only.

20 Jan 2025
1 min read

Webinar: DB outlook 2025

We're delighted to share a recent client webinar on the outlook for DB schemes in 2025, held in partnership with Professional Pensions.

Bridge under construction

2025 could bring opportunities for change as the rate-cutting cycles in the US and Europe mature, and markets begin to digest the post-election changes of 2024. 
 
UK DB pension schemes have been taking stock since the gilt crisis and may now be looking to adapt their portfolios in light of the increased freedom that higher funding ratios grant them. With DB assets of c.£1.2 trillion and over a  third of schemes (by value) being in surplus on a buyout basis as at 31 March 2024[1], there is much to think about:
 
1. Firstly, schemes that benefitted from the increase in global yields  could increasingly be looking to maintain and manage their surplus,  as regulatory frameworks for run-on evolve. Others could look to continue to run on, while preparing to align portfolios for buyout opportunities.
 
2. Secondly, the continued low levels of credit spreads may present opportunities for those schemes that can position their portfolios towards short-dated credit for now, while being ready to invest more in longer-dated exposure if spreads widen.
 
3. Thirdly, the continuing theme of consolidation could yield benefits for those schemes looking to simplify their governance models and adapt according to their endgame objectives. 

Watch our latest DB client webinar.

 

[1] Source: The Purple Book 2024

 

Key risks
The value of an investment and any income taken from it is not guaranteed and can go down as well as up, and the investor may get back less than the original amount invested.

Endgame Solutions Liability Driven investing Defined Benefit (DB) OCIO
Tim Dougall

Tim Dougall

Head of Delegated Solutions

Tim is Head of Delegated Solutions at LGIM, responsible for providing holistic portfolio management services to a range of institutional investors. He works with clients across a broad spectrum of investment...

More about Tim
AnneMarie Morris

Anne-Marie Morris (née Cunnold)

Head of DB Solutions Strategy

Anne-Marie leads the team responsible for the strategy of objective-driven investment solutions, principally for Defined Benefit Pension Scheme clients. In partnership with the Solutions Portfolio…

More about Anne-Marie
Mat Webb

Mathew Webb

Head of Endgame Solutions

Mathew is Head of Endgame Solutions within LGIM's Solutions business and specialises in helping pension schemes achieve their endgame objectives, whether that is buyout (pension…

More about Mathew

Recommended content for you

Learn more about our business

Legal & General Investment Management is one of the world's largest asset managers, with capabilities across asset classes to meet our clients' objectives and a longstanding commitment to responsible investing.

Image of London skyscrapers

Sign up for blog email alerts

Receive the latest articles in a weekly digest by registering via the email preference centre