The FINANCIAL -- Almost a quarter of Dutch pension funds have to cut returns to employees next year, the Dutch central bank said Monday based on status reports the pension funds have sent to it.

According to a Dutch central bank statement, 117 of the around 450 Dutch pension funds have to take additional measures to reach the legally required coverage ratio of 105%. 103 of the 117 pension funds told the Dutch central bank they have to cut returns, the authority said.

According to Borsa Italiana - London Stock Exchange Group, the total liabilities of these 103 pension funds amount to around EUR390 billion and the measures affect around 7.5 million employees, according to the central bank.

Pension funds in the Netherlands have to use market interest rates to value their long-term liabilities. Lower rates mean they must put more money aside to meet their current and future obligations. The industry claims this leaves them too exposed to market volatility and gives a distorted picture of their capital position.

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