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Largest public companies' pension funding improves in May

Posted On: Jun. 4, 2015 12:00 AM CST

Largest public companies' pension funding improves in May

The funded status of very large pension plans sponsored by public companies rose in May as rising interest rates lowered the value of plan liabilities, according to a Milliman Inc. survey released Thursday.

Defined benefit plans offered by U.S. employers with the 100 largest pension programs were an average of 84.1% funded as of May 31, up from 82.6% funded as of April 30.

At the end of May, the plans had $1.477 trillion in assets and $1.756 trillion in liabilities, resulting in a funding deficit of $279 billion. That is a decrease of $32 billion compared with the end of April when the funding shortfall was $311 billion.

“The second quarter of 2015 has reversed the losses we saw in the first quarter,” John Ehrhardt, a Milliman principal and consulting actuary in New York said in a statement.

“For the year these pensions have now experienced a $50 billion decrease in the funded status deficit, thanks to rising interest rates,” Mr. Ehrhardt added.