Amsterdam- The reserves of Dutch pension funds have dropped dramatically due to investment losses in the ongoing financial crisis, Dutch media reported on Thursday.

The "cover factor" of many funds (a percentage that determines to what extent the funds can meet their obligations to pay pensions) have dropped dramatically in the third quarter of 2008.

Funds are required by law to hold in reserve a minimum of 125 per cent of obligations.

ABP, the fund responsible for the pensions of all Dutch civil servants, saw its cover factor drop from 132 to 118 per cent.

With 2.7 million participants, ABP is one of the world's largest pension funds.

The fund manages some 195 billion euros (250.28 billion dollars) and has lost 10 billion euros since the second quarter of 2008.

ABP has informed the central Dutch bank DNB its cover factor has dropped below the 125-per-cent threshold and announced it is preparing a rescue plan to increase the fund's cover factor as soon as possible.

The Zorg and Welzijn pension fund - responsible for some 2.1 million people in the medical healthcare and social welfare industry - said its cover factor dropped from 143 to 126 per cent.

Zorg and Welzijn added it might not be able to adjust next year's pensions for inflation. A decision about the adjustment would be taken in December.

The Zorg and Welzijn fund lost some 4 billion euros in the last quarter and now is worth 81.9 billion euros.

The cover factor of the pension funds for the steel industry PMT fund, and the electronics industry's PME dropped to 116 and 112 per cent respectively.

Both funds will prepare a rescue plan to improve their cover factors.

PMT and PME, whose pension funds have a combined 2 million participants, warned employees' monthly premiums to the funds may have to be increased. (dpa)