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Corporate Pension Funded Status Improves

The funded status of the 100 largest corporate pension plans improved in October, says a recent report. The actuarial consultant firm Milliman says that their funded status got stronger to the tune of $28 billion.

Their funded status in October was 1 percentage point better in October than it was in September, says Milliman, and now stands at 77.3%. This was the biggest month-to-month change of 2016, and reflects the drop in the collective corporate pension plan deficit to $410 billion.

And there’s more good news. The report also says that the projected benefit obligation of those 100 plans fell from $1.848 trillion on Sept. 30 to $1.803 trillion by Halloween. This is due to an increase of 19 basis points in the monthly discount rate, which stood at 3.42% in September and 3.61% in October.

While the funded status improved, Milliman says that the market value of plan assets did not. Milliman says that it fell by $17 billion in October due to investment losses of 0.84%. The funded status improvement in October, says Milliman, was due to interest rate gains.