The table below shows the impact on the value of these assets of an 8.7% strengthening or weakening of sterling against foreign currencies. The analysis assumes that all other variables remain unchanged.
| Assets exposed to currency risk | Value £000s | Currency risk | Value on foreign exchange rate increase £000s | Value on foreign exchange rate decrease £000s |
|---|
| As at 31 March 2026 | 1,101,112 | 8.7% | 1,196,909 | 1,005,316 |
| As at 31 March 2025 | 1,115,930 | 9.1% | 1,217,480 | 1,014,380 |
Credit risk represents the risk that the counterparty to a transaction or a financial instrument will fail to discharge an obligation and cause the Fund to incur a financial loss. The market values of investments generally reflect an assessment of credit in their pricing and consequently the risk of loss is implicitly provided for in the carrying value of the Fund's financial assets and liabilities. The selection of high-quality fund managers, counterparties, brokers, and financial institutions minimises credit risk that may occur through the failure to settle a transaction in a timely manner. The Fund sets both maximum investment limits and minimum credit rating limits.
There is a risk that some admitted bodies may not honour their pension obligations with the result that any ensuing deficit might fall upon the Fund. To mitigate this risk, the Fund regularly monitors the state of its admitted bodies and bond agreements are in place for scheme employers to ensure liabilities would be met in the event of an employer being dissolved, wound up, liquidated, or otherwise ceasing to exist.
The Fund has no financial assets past their due date as at 31 March 2026 and has not identified any events or conditions to date that would suggest that any impairment or provision in respect of credit risk is required.
The investment credit exposure is summarised in the table below;
| Balances as at 31 March 2025 | Balances as at 31 March 2026 |
|---|
| Summary | Rating | £000's | £000's |
|---|
| Bank Current Accounts | | | |
|---|
| Lloyds Bank | A+ | 35,846 | 11,541 |
|---|
| Money Market Funds | | | |
|---|
| BNY Mellon Goldman Sachs MMF | AAA | 13,691 | 100,137 |
|---|
| Total | | 49,537 | 111,678 |
|---|
Liquidity risk represents the risk that the Fund will not be able to meet its financial obligations as they fall due. The Panel monitors cash flows and takes steps to ensure that there are adequate cash resources to meet its commitments.
The Fund has immediate access to its cash holdings; cash held on deposit is highly liquid and readily available to the Fund as required. In the event that the Fund was unable to