How can the financial stability of the Swiss occupational pension funds be strengthened?
By analyzing the effects of interest rates in the current context and testing the robustness of the Swiss 2nd pillar's financial capacity, the authors present updated calculations and results and possible future scenarios.
In 2022, GSEM Professor Olivier Scaillet with Marc Fournier, Olivier Kern, and Stéphane Riesen (from Pittet Associés) published an analysis of the stability of the Swiss 2nd pillar. The study demonstrated the direct and indirect effects of the evolution of interest rates on the financial capacity and solidity of the Swiss occupational pension fund.
Since then, inflation and interest rates have risen in Switzerland. In a Public Discussion Note that builds on the 2022 study, the authors present updated calculations and results for the current economic context and possible future scenarios. The granularity of the data used has allowed the team to develop a precise model of the evolution of each pension fund, better identify the risks facing institutions, and propose recommendations to improve and reinforce the stability of the Swiss occupational pension funds.
Their revisited findings determine that the Swiss 2nd pillar system remains robust and even in a long-term economic downturn, the financial stability of the fund could be guaranteed by reducing certain benefits.
> Read the Public Discussion Note: Pension at Risk: Is Our Pension System Under Threat? Future Scenarios for the Swiss 2nd Pillar
> Click here for more information on the 2022 study
August 4, 2023