The financial health of Ontario’s Defined Benefit pension plans remained stable in Q3 despite continuing economic uncertainty

The Financial Services Regulatory Authority of Ontario’s (FSRA) Q3 2022 solvency report finds that the majority of Ontario pensions are generally in good health at the end of the third quarter despite economic challenges and market volatility.

In fact, most of Ontario pension plans are projected to be fully funded.

While many pension plans may have surpluses, it is important to be aware that the funded status could change drastically and on short notice.

We encourage plan sponsors and administrators to consider various stress tests and to continuously monitor plan risks.

Here are some key findings:

  • The median projected solvency ratio was 109%, a slight decrease from 110% as at June 30, 2022.
  • The percentage of pension plans that were projected to be fully funded on a solvency basis was 78%. The percentage of plans falling below an 85% solvency ratio was 3%, unchanged from the end of last quarter.
  • Investment returns were slightly negative for the quarter, resulting in pension funds averaging a net return of -0.4%. It was also the third consecutive quarter of negative fund returns, with year-to-date net returns averaging -16.3%.
  • Rising interest rates largely offset the impact of asset losses over the quarter.

Solvency monitoring is one supervisory tool FSRA uses to improve outcomes for pension plan beneficiaries and to proactively engage in a dialogue with plan sponsors.

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FSRA continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone. 

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For media inquiries:

Russ Courtney
Sr. Media Relations and Digital Officer
Financial Services Regulatory Authority
C: 437-225-8551
Email: [email protected]