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Pension plan funding improves in June

Posted On: Jul. 9, 2015 12:00 AM CST

The funded status of very large pension plans sponsored by public companies climbed in June 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 85.6% funded as of June 30, up from 84.1% funded as of May 31.

At the end of June, the plans had $1.449 trillion in assets and $1.692 trillion in liabilities, resulting in a funding deficit of $243 billion. That is a decrease of $36 billion compared with the end of May, when the funding shortfall was $279 billion.

“It's no coincidence that we've seen a related decrease in pension liabilities, with rising discount rates reducing liabilities by $92 billion year to date and contributing to a strong quarter for the 100 largest corporate pensions,“ John Ehrhardt, a Milliman principal and consulting actuary in New York, said in a statement.