Funding of large firms' pensions nudged upward in July
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Aided by a rise in the equity markets that more than offset lower interest rates, the funded status of pension plans sponsored by large employers rose slightly in July, Mercer L.L.C. reported Wednesday.
On average, pension plans sponsored by companies in the S&P 1500 were 77% funded at the end of July, up from 76% at the end of June.
“Long-term interest rates continue to drop, increasing the liabilities on plan sponsor’s balance sheets. While the drop in rates this month was offset by strong equity returns, the S&P 500 peaked on July 22nd and stagnated for the rest of the month,” Jim Ritchie, a Baltimore-based partner in Mercer’s retirement business, said in a statement.
In all, the plans had $1.88 trillion in assets and $2.44 trillion in liabilities at the end of July. The plans’ aggregate funding deficit declined by about $6 billion in July to $562 billion, Mercer said.
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