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Funded status of large pension plans unchanged in May: Mercer

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Funding of Large Pension Plans

The funded status of pension plans sponsored by large companies held steady in May, according to a Mercer L.L.C. survey released Wednesday.

On average, pension plans sponsored by companies in the S&P 1500 were 84% funded as of May 31, unchanged from April 30, but down slightly from 85% in March.

The small gains in equities markets, which boosted the value of plan assets, were essentially offset by declines in interest rates, which raised the value of plan liabilities, Mercer said in a statement.

“A fairly modest decline in interest rates was enough to mostly wipe out a pretty positive month of equity returns, highlighting the volatility to which many U.S. plan sponsors are exposed,” Jonathan Barry, a partner in Mercer's retirement business in Boston, said in the statement.

In all, the plans had an aggregate funding deficit of $343 billion at the end of May, down from $360 billion as of April 30, but up from a $332 billion shortfall at the end of March.

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