The aggregate deficit of the around 5,500 defined benefit (DB) schemes in the Pension Protection Fund (PPF) 7800 Index almost halved over the course of September.
This meant the aggregate deficit fell from £65.3bn in August to £38.7bn at the end of September.
Meanwhile the funding ratio increased from 96.1 per cent at the end of August 2018 to 97.7 per cent.
At the end of September the total assets in DB schemes were £1.62trn, while total liabilities were £1.65trn.
There were 3,437 schemes in deficit and 2,151 schemes in surplus, the PPF said.
Andy Tunningley, head of UK strategic clients at BlackRock, said pension schemes had a successful month, with funding levels rising to their highest level for over a year.
He said the rise in funding level happened "as gilt yields rose across the curve, reducing liabilities".
He said: "Continued positive equity markets also helped to keep asset levels, and therefore funding levels high.
"However, we are still only 0.8 per cent above where funding levels were in January so schemes should not get complacent."
With September marking 10 years since the collapse of Lehman Brothers and the start of the financial crisis, Mr Tunningley noted that "attention has naturally turned to how schemes have fared and whether they are more prepared were there to be another shock to the system".
He said that according to PPF’s Purple Book, most schemes have de-risked significantly over this period, with the average plan having less than a third of their assets in equities compared with more than 50 per cent in 2008.
He added: "Furthermore, the rise in the adoption of liability driven investments (nearly £1bn of liabilities were hedged at the end of 2017) is evidence that schemes have become more wary of the possibility of large market events which could disrupt portfolios and have built more resilience in as a result."
Mr Tunningley said the "days of schemes waiting for yield rises to get them out of trouble are long gone".
"However, trustees remain their own worst enemies as demand for government and corporate bonds continues to far exceed supply, keeping yields and credit spreads at very low levels with little chance of these rising significantly," he said.
He added: "We believe now is the right time for pension schemes to be investing in alternative asset classes to help them to manage the ever-harder balancing act between risk management, cash-flow generation and return and to take advantage of exposures they cannot access in public market equivalents."
The PPF 7800 Index takes into account the funding position of final salary plans eligible for entry to the pensions lifeboat, on a section 179 basis.
This represents the premium that would have to be paid to an insurance company to take on the payment of PPF levels of compensation.
maria.espadinha@ft.com
