The global financial crisis seems like a walk in the park compared to what we have seen in the past six days in the UK pensions industry. And, for the most part, the speed of it caught everyone — asset managers, banks, pension consultants, trustees and sponsors — completely unaware.
We first got wind that something wasn’t quite right on Friday afternoon, the day of the mini-budget. We thought that might be the end of it, but it picked up steam on Monday morning. No one outside the pension industry seemed to notice for the first two days of the crisis. All the attention was on sterling.
So, what happened? Gilt yields rose sharply following the mini-budget. Pension schemes have hedged their liabilities against changes
