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Largest pension plans' funding near steady in 2015

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The funding levels of the largest pension plans sponsored by publicly held U.S. employers remained nearly steady in 2015 as higher interest rates, which decreased the value of plan liabilities, largely offset lackluster investment returns, according to a Milliman Inc. survey released Thursday.

Defined benefit plans offered by the 100 U.S. employers with the largest pension programs were, on average, 81.8% funded at year-end 2015, up from 81.7% at the end of 2014.

The market value of plan assets in 2015 fell to $1.378 trillion, down from $1.454 trillion a year earlier, while the value of plan liabilities dropped to $1.685 trillion from $1.780 trillion.

In all, the plans were underfunded by $307.4 billion in 2015, down from $326.1 billion in 2014.

Among surveyed employers, Armonk, New York-based International Business Machines Corp. had the biggest defined benefit pension program in 2015 with $87.5 billion in assets, down from $95.3 billion in 2014. Its plans were 89.4% funded in 2015, a slight dip compared with 89.5% in 2014.

General Motors Co. had the second-largest pension program with $74.1 billion in assets, down from $80.5 billion in 2014. Its plans were 77.8% funded in 2015, up from 76.9% in 2014.

NextEra Energy Inc., a Juno Beach, Florida-based energy and utility company, had the highest funded ratio in 2015 at 148.0%, down from 149.6% in 2014.

At the other end, Atlanta-based Delta Airlines Inc. had the lowest funded ratio at 45.5% in 2015, up from 42.8% in 2014.

In conducting the survey, Seattle-based Milliman analyzed financial reports of publicly held companies sponsoring the 100 largest pension programs for which full-year data was available.

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