Bank of Ireland H1 2020 Credit Presentation
Defined Benefit Pension Schemes
Group IAS19 Defined Benefit Pension (Deficit) / Surplus
1.60%
2.10%
2.00%
Bank of Ireland H1 2020 Credit Presentation
Total Group Defined Benefit Pension Scheme Assets (%)
€7.1bn
€7.2bn
€7.2bn
€8.4bn
€8.5bn
1.45%
1.30%
€0.53bn
58%
55%
65%
65%
68%
(€0.23bn)
(€0.14bn)
(€0.48bn)
17%
21%
23%
23%
21%
25%
24%
12%
12%
11%
Dec 17
Dec 18
Dec 19
Jun 20
Jun 16
Dec 17
Dec 18
Dec 19
Jun 20
■IAS19 DB Pension (Deficit) / Surplus
EUR Discount Rate
Diversified assets
Credit / LDI / Hedging
(€1.19bn)
Jun 16
€313m
IAS19 Pension Deficit Sensitivities
(Jun 2016 / Dec 2017 / Dec 2018 / Dec 2019 / Jun 2020)
€181m
€173m €162m €153m
€166m
€118m €102m €109m €33m
Interest Rates¹
Credit Spreads²
€122m €128m
€71m
€90m €102m €118m
€28m €28m
€38m
€19m
Inflation³
Global Equity4
1 Sensitivity of Group deficit to a 0.25% decrease in interest rates
2 Sensitivity of IAS19 liabilities to a 0.10% decrease in credit spread over risk free rates
3 Sensitivity of Group deficit to a 0.10% increase in long term inflation
4
Sensitivity of deficit to a 5% decrease in global equity markets with allowance for other
correlated diversified asset classes
•
.
•
Listed equities
'Diversified assets includes infrastructure, private equity, hedge funds and property
IAS19 Pension surplus of €0.53bn at Jun 2020 (€0.14bn deficit Dec
2019). Schemes in deficit €0.18bn, schemes in surplus €0.71bn
Discount rates increased from year end - a significant fall in risk
free interest rates was more than offset by a rise in credit spreads
The interest rate hedging in the investment portfolios largely
compensated for the impact of the reduction in risk free rates,
and widening credit spreads resulted in an overall improvement
in the balance sheet position
Long term inflation assumptions have also decreased in the
period with the reduction in liabilities partially offset by the
reduction in inflation hedging assets
De-risking strategies in recent years have also reduced the
schemes' sensitivity to global equity movements. Listed equity
asset holdings have been reduced in favour of increases in
Diversified assets and Credit / LDI / Hedging allocations
Bank of Ireland
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