The average time to buyout for FTSE 350 defined benefit (DB) pension schemes rose slightly to 5.2 years in July 2023, Barnett Waddingham’s DB End Gauge Index has revealed.

This marked a slight increase on the previous month, which Barnett Waddingham attributed to an increase in the value placed on scheme liabilities following a small reduction in average swap rates and bond yields.

This, according to the firm, more than offset the impact of positive asset returns over the period.

Despite this, Barnett Waddingham principal, Lewys Curteis, suggested that "after the dramatic financial market changes experienced last year, this period of relative calm provides an ideal opportunity to revisit DB scheme funding and investment strategies to ensure that these are consistent with company objectives and risk appetites.”

Industry experts previously suggested that recent DB funding improvements could be set to trigger a record-breaking period in the bulk-purchase annuity market, with research revealing that 86 per cent of DB trustees expect to approach an insurer about a buy-in or buyout within the next five years.

However, trustees have been reminded of the importance of scheme preparation amid this busy period, with some warning that while there is considerable appetite within the de-risking market right now, there is finite capacity within the industry.

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