July 11, 2018

Funded Status of Top 100 Private DB Plans Improves in June

 

The funded status of the 100 biggest private-sector defined benefit plans improved in June, says a recent report.

The funded status of the 100 biggest private-sector defined benefit plans improved in June, Milliman reports.

According to the Milliman 100 Pension Funding Index, those plans’ collective funding improved by $23 billion in June. The funded percentage improved since May by 1.2 percentage points from 91.6% to 92.8%. And their deficit fell from $141 billion on May 31 to $118 billion on June 30.

This marks an improvement from the Federal Reserve’s report that from the fourth quarter of 2017 to the first quarter of 2018, private DB plans’ funded status declined slightly.

However, MIlliman also reports that the top 100 DB plans’ assets dropped slightly in June; they stood at $1.531 trillion at the end of May and $1.526 at the end of June. It attributes this to poor returns from the accounts into which the plans funds are invested.

Despite the relative holding pattern for the plans’ assets, Milliman says that the longer-term trajectory is positive. It says that for the period July 1, 2017-June 30, 2018, the plans’ funded status has improved by $138 billion and their funded ratio has grown by 7.6 percentage points from 85.2% during the previous 12-month period.