The funded status of a typical Canadian defined benefit pension plan decreased on a going concern basis and solvency basis during the first quarter of 2026, according to a new report by Normandin Beaudry.
It found the average going concern ratio decreased from 132 per cent to 129 per cent, while the average solvency ratio dropped from 118 per cent to 116 per cent. It also noted a number of pension plans are in a surplus position on both a going concern and solvency basis.
Read: Report finds solvency ratio of typical DB pension plan decreased to 100.7% in February
While the first quarter of 2026 was characterized by increasing geopolitical tensions, global stock market returns were generally positive in the first two months of the year, the report noted. However, this market upturn was reversed in March, following the escalation of the military conflict in Iran.
“Although key rate cuts were expected in 2026, markets are now anticipating an increased risk of monetary tightening,” the report said. “Rising energy costs are exerting pressure on supply chains, raising the possibility of a return to inflation after several months of calm. This was reflected in the bond market with a general increase in interest rates.”
Read: Ontario DB plans’ average solvency ratio stays flat at 124% in Q4 2025: FSRA