Pension funding down in August on market slide
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The funded status of very large pension plans sponsored by public companies slipped in August as declines in the equity markets more than offset rising interest rates, according to a Milliman Inc. survey released Wednesday.
Defined benefit plans offered by U.S. employers with the 100 largest pension programs were an average of 83.4% funded as of Aug. 31, down from 84.9% funded as of July 31.
“For the year, these pensions had performed well on the asset side, but August erased all those gains,” John Ehrhardt, a Milliman principal and consulting actuary in New York, said in a statement.
At the end of August, the plans had $1.417 trillion in assets and $1.699 trillion in liabilities, resulting in a funding deficit of about $282 billion. That is an increase of about $22 billion compared with the end of July, when the funding shortfall was about $260 billion.
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