Minimum funding requirement

 

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Minimum funding requirement

A rule introduced in the wake of the Maxwell pensions scandal which was intended to ensure that company pensions funds always had enough assets to pay out their liabilities (i.e. pensions to retired members of the scheme).The legislation uses the yield from long term gilts as the yardstick by which a pensions fund's liabilities are measured. To stay within the rules, funds have felt obliged to buy these long-term bonds, with the result that their price has gone sky high.One alternative being considered is to change the whole way liabilities are valued and, in effect, to allow the funds to invest in more exciting securities than gilts, but to couple this with an insurance fund that bails out those funds that are unable to meet their liabilities. This insurance fund would be called the Central Discontinuance Fund (CDF).



Similar Matches

Sinking fund requirement

Sinking fund requirement

A condition included in some corporate bond indentures that requires the issuer to retire a specified portion of debt each year. Any principal due at maturity is called the balloon maturity.


Performance requirement

Performance requirement

A requirement that an importer or exporter achieve some level of performance, in terms of exporting, domestic content, etc., in order to obtain an import or export license.


Assets requirements

Assets requirements

A common element of a financial plan that describes projected capital spending and the proposed uses of net working capital.


Dividend requirement

Dividend requirement

The annual earnings minimum required for payment of dividends on a preferred stock.


Margin requirement

Margin requirement

A performance bond paid upon purchase of a futures contract that protects the exchange clearinghouse from loss.


Further Suggestions

Listing requirements
Advance deposit requirement
Content requirement
Margin requirement (options)
Export performance requirement
Domestic content requirement
Export requirement
Public Sector Borrowing Requirement
Requirement Indicator Matrix
Net capital requirement
Public Sector Net Cash Requirement
Offset requirement
Reserve requirements
Unit labor requirement
Capital requirements
Initial margin requirement
Materials requirement planning
Local content requirement


 
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