New research has shown that the largest 300 pension funds have seen their total assets grow by almost 10 per cent in 2012, compared to just two per cent growth in the year before.
The study, conducted by Pensions & Investments and Towers Watson research found that those top 300 funds now represent over 47 per cent of global pension assets.
By individual region, Asia-Pacific has had the highest five-year compound growth rate of 7% compared to Europe (6%) and North America (-1%); while the Latin American and African regions combined have a growth rate for the same period of around 11%, albeit from a low base.
According to the research, defined benefit (DB) funds account for 69% of total assets, down from 75% five years ago. During 2012, DB assets grew by around 8% (1% in 2011) compared to around 12% for defined contribution assets (DC) (6% in 2011), while reserve funds grew by almost 18% (1% in 2011).
Carl Hess, global head of Investment at Towers Watson, said:
The rise in pension assets in 2012 was a combination of investment market recovery and new cash commitments. There were many similarities to the year before – bumpy recovery accompanied by occasional hyper-volatility in markets - but with some notable differences which are cause for some encouragement for the first time in five years.