Household Financial Wealth By Selected Country

Transcription

1 Household Financial Wealth By Selected Country US$ Trillions % Indicates Projected Shortfall Extrapolation of Historical Growth Projection (Based on Demographic Trends) -47% -34% -25% -39% 10 0 U.S. Japan U.K. Germany Italy Source: McKinsey Global Institute

2 Public Fund Survey Overview Survey presents data in public retirement systems that provide pension and other benefits for a combined 12.8 million active (working) members and six million annuitants. Combined, systems in the survey hold trust $2.26 trillion, invested in diversified portfolios of public and private equities, corp. and gov. bonds, real estate, cash etc. According to the U.S. Census, state and local government employees comprise more than 10% of the nation s workforce.

3 Asset Allocation of Systems in Public Fund Survey Real Estate 4.8% Alternatives 4.4% Cash 1.9% International Fixed Income 1.3% Domestic Fixed Income 27.0% Equities 60.5%

4 Actuarial Funding Aggregate for the 125 Plans in the Public Fund Survey Actuarial Funding Ratio 85.9% Actuarial Assets (000's) $2,254,612,148 Actuarial Liabilities (000's) $2,625,305,539 Unfunded Liability (Surplus) (000's) $370,693,391

5 Actuarial Assumptions Median for the 125 Plans in the Public Fund Survey Investment Return Assumption 8.0% Inflation Assumptions 3.5% Assumed Real Rate of Return 4.5% Actuarial Valuation Date 6/30/2005

6 Change in Aggregate Actuarial Assets, Liabilities, and Funding Levels Aggregate for the 114 Plans in the Public Fund Survey US$ Trillions Actuarial Assets - L Actuarial Liabilities - L Actuarial Funding Ratio - R Percent Fiscal Year

7 Annual Change in the Aggregate Actuarial Value of Assets and Liabilites Based on 117 Plans in the Public Fund Survey Percent 10 8 Assets Liabilities Fiscal Year 04 05

8 Median Annual Public Pension Fund Investment Returns Based on 117 Plans in the Public Fund Survey Percent Fiscal Year

9 Ratio of Actives per Annuitant Annuitants Include Retired Members, Beneficiaries, Disabilitants Ratio Fiscal Year 04 05

10 Combined Market Value of Assets in the Public Fund Survey Aggregate for the 94 Systems in the Public Fund Survey US$ Trillions Combined Assets - L Annual Change - R Percent Fiscal Year

11 Pension Benefits Paid Aggregate for the 91 Systems in the Public Fund Survey US$ Billions Pension Benefits Paid - L Annual Change - R Percent Fiscal Year

12 Pension Contributions and Annual Change Aggregate for the 91 Systems in the Public Fund Survey US$ Billions 75 Percent Pension Contrib. - L Annual Change - R Fiscal Year

13 Market Value of System Assets Ranked by Top Ten Systems, As of 6/30/06 Ra nk Syste m Na m e Asset Market Value (US$ Millions) Active Members Annuitants 1 Ca lpers $ , ,341 2CalSTRS $ , ,241 3 New York State and Local Retirement Systems $ , ,251 4 Florida Re tire m e nt Syste m $ , ,184 5 Teacher Retirement System of Texas $ , ,144 6 New York State Teachers Retirement System $ , ,587 7 New Jersey Division of Pension and Benefits $ , ,372 8 Wisconsin Retirement Systems $ , ,445 9 North Carolina Retirement Systems $ , , Ohio State Teachers Retirement System $ , ,184

14 Unfunded Liability Surplus Rank is Based on 124 Plans, As of 6/30/06 Unfunded Liability Rank Plan Name (Surplus) 1 Florida RS ($6,181,784) 2 NC Teachers and State Employees ($3,555,655) 3 Oregon PERS ($2,088,600) 4 Texas County & District ($569,314) 5 San Francisco County and District ($414,542) Texas Teachers $13,639, Ohio Teachers $19,362, California Teachers $20,311, Illinois Teachers $22,412, California PERF $26,630,000

15 Projected Risk and Return By State Pension System Source: Wilshire Consulting

16 100 Most Underfunded S&P 500 Defined-Benefit Plans US$ Billions $ $141 -$114 -$137 -$138 -$ Source: Bloomberg

17 Pension and Life Insurance Assets in Selected Countries Percent of GDP, 2005 Pension Reserve Funds Pension Funds Life Insurance United States Ireland Norway Denmark Japan Sweden Finland Canada France Korea Portugal New Zealand % Source: OECD, Global Pension Statistics, Insurance Statistics and other administrative sources.

18 Importance of Pension Funds in Selected Countries Percent of GDP, 2005 Netherlands Iceland Switzerland U.S. U.K. Finland Australia Ireland Canada Denmark Japan Sweden Portugal New Zealand Spain Poland Hungary Mexico Norway France Austria Belgium Czech Rep. Germany Italy S. Korea Slovak Rep. Luxembourg Turkey Greece Source: OECD, Global Pension Statistics, Insurance Statistics and other administrative sources Weighted average: 87.6% %

19 Private Pension Plans Assets by Type of Financing Vehicle US$ Billions and As a Share of Total, 2004 Pensino funds Book reserve Pension insurance contract Canada Denmark Finland Italy Korea Spain Sweden United States 11,638 1,987 0% 20% 40% 60% 80% 100% Source: OECD, Global Pension Statistics, Insurance Statistics and other administrative sources.

20 Cash Flows from G-10 Government Bonds and Projected Pension Payments Percent Payments from G-10 Government Bonds Outstanding Projected Payments Out of G-10 Pension Fund Liabilities Cash Flows Assumption: 75 percent of total pension fund assets are allocated to bonds Source: OECD, Global Pension Statistics, Insurance Statistics and other administrative sources.

21 Health Care Expenditure for Selected Countries Public and Private Spending, as Percent of GDP Percent of GDP Private spending Public spending U.S. Germany France Canada Norway Australia Neth. Denmark N. Zealand U.K. Japan Finland OECD Source: OECD, Global Pension Statistics, Insurance Statistics and other administrative sources.