Financial position

Checked on: 31 October 2022

Financial position

One of the factors used to determine the financial position of Philips Pensioenfonds is its funding ratio. If a pension fund has a funding ratio of 100%, this means that its assets exactly cover its existing pension liabilities. A series of financial rules laid down in the Financial Assessment Framework (Financieel Toetsingskader) have been used to define the following types of funding ratios:

Quarterly report

Every quarter you can read in this report how Philips Pensioenfonds is doing financially.

Quarterly report 2022 Q3 (in Dutch)

Current funding ratio

The current funding ratio reflects the value of the pension fund’s assets as a proportion of the pension liabilities (all pensions payable now and in the future).

At 30 September 2022, Philips Pensioenfonds had a actual funding ratio of 129.5%. 


Policy funding ratio

Another way of calculating the funding ratio that is less subject to daily fluctuations is the policy funding ratio. The policy funding ratio is calculated by taking the average of the actual funding ratios over the past twelve months. By law, pension funds are required to use their policy funding ratio for deciding on various matters, for example indexation. The policy funding ratio is also used for other purposes, including to establish whether the pension fund’s buffers are sufficient.

At 30 September 2022, Philips Pensioenfonds had a policy funding ratio of 129.0%.


Required funding ratio

The required funding ratio is the minimum policy funding ratio that pension funds are required to have according to the law. If a pension fund’s policy funding ratio is at the same level as the required funding ratio, this means that it has the financial buffer required by law. The purpose of this buffer is to compensate for fluctuations in the value of the pension fund’s investments and liabilities. The required funding ratio varies from one pension fund to the next, and is determined largely by the pension fund’s investment policy: the higher the risks in the investment policy, the higher the required funding ratio.

At 30 September 2022, the required funding ratio of Philips Pensioenfonds is not yet known at the time of publication of this webpage.

Amounts in millions of euros        
  End of Q3 2022 End of Q2 2022 End of Q1 2022 End of Q4 2021
Pension fund's assets (1) 17,781 18,766 22,042 23,853
Pension liabilities 13,734 14,885 17,322 18,034
Current funding ratio 129.5% 126.1% 127.3% 132.3%
Policy funding ratio 129.0% 128.6% 128.1% 128.8%

Latest developments

In the third quarter of 2022, the actual funding ratio increased from 126.1% at the end of June to 129.5% at the end of September. The increase in the funding ratio was the result of an increase in interest rates in the third quarter. Inflation is higher and lasting longer than previously thought. In response, interest rates have risen. With a higher interest rate, the Pension Fund's pension liabilities fall sharply. This is favorable for the funding ratio. However, a higher interest rate also makes it less attractive to invest in equities. The return on the equity portfolio was therefore negative. Fixed-income investments also returned negatively as a result of the rise in interest rates. These negative returns led to a decline in pension assets of
Philips Pensioenfonds. However, the fall in pension liabilities was stronger than the fall in pension assets. As a result, the actual funding ratio rose by more than 3 percentage points in the third quarter.


(1) The pension assets represent the size of the Pension Fund's financial resources. There is a difference between the pension assets and the invested assets. This difference consists of a number of items (including taxes to be paid and social insurance contributions) that are or are not included in the pension assets on the one hand and the invested assets on the other. The funding ratio is based on the pension assets.

Related information

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Indexation policy

We try to increase your pension every year. This is called 'indexation'. But indexation cannot be taken for granted. Do you want to know more about our indexation policy?

Go to Indexation policy