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First Quarter Corporate Pension Funding Status News Lackluster

Corporate pension funding levels in the first quarter of 2015 lost some ground, according to analysts from two industry sources. Assets grew, but not to the extent that liabilities did, the reports say.

Corporate pension plan assets grew 2.61% on the strength of the performance of most asset classes during the first quarter, according to Pensions & Investments, which cited data from BNY Mellon. At the same time, BNY Mellon’s Institutional Scorecard says, the plans’ liabilities grew 2.79%. Legal & General Investment Management America (LGIMA) reports similar results: Assets showed a 2.2 percentage point increase, and liabilities a 3.8 percentage point rise.

BNY’s scorecard says that the funding ratio of a typical corporate pension plan fell 10 basis points in the first quarter. LGIMA reports a much more severe drop for a typical plan during that time — 140 basis points.

BNY also provides a more detailed look at funded status for the last month of the first quarter. In March, BNY Mellon Investment Strategy and Solutions Group says, for a typical corporate pension plan, assets decreased 0.5% and liabilities fell 0.1%. In addition, those plans lost 0.4 percentage point, which it attributed to a decline in most equity categories.