March 2024
26Mar

Funded Status of Largest 100 US Public Pension Funds Rises to 78.6%

Public pension funded status increased to 78.6% at the end of February, up from 77.7% the month before, according to the monthly Milliman Inc. 100 Public Pension Funding Index, which tracks the funded status of the largest 100 public defined benefit plans in the U.S. Public plan funded status rose in February to the highest level since May 2022, when funded status for these plans stood at 78.4%, and 78.6% the month before. In the interim, funded status bottomed out at...

March 26, 2024
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13Mar

US. Corporate Pension Funding Levels Skyrocket in February

The funded status of U.S.-based corporate pension plans increased significantly in February, primarily due to a rally in technology stocks, driven by excitement over AI and semiconductors, according to industry reports. Funded status also continues to be boosted by heightened interest rates. The surplus in pension funding could have some plan sponsors considering what to do with their excess pension assets. Earlier this month, Eastman Kodak announced it would shut its investment office, shifting the management of its assets to...

March 13, 2024
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13Mar

U.K. pension fund surplus and funding ratio rises in February

The total surplus of U.K. corporate pension funds covered by the Pension Protection Fund, London's 7800 index increased by 4% in February to £442.3 billion ($559.8 billion), while the funding ratio also rose. The funding ratio increased to 146.1% as of Feb. 29, compared to 143.9% at the end of January, an update said. The total deficit of all plans with a shortfall was £3.9 billion as of Feb. 29, down from £4.3 billion as of Jan. 31. Total assets were...

March 13, 2024
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07Mar

U.S. corporate pension surpluses rise in February – 4 reports

U.S. corporate pension plan funding surpluses grew in February thanks to positive returns from growth assets as well as falling liabilities, according to four new reports. Wilshire Advisors estimated the aggregate funding ratio of U.S. corporate plans reached 109.4% as of Feb. 29, up from 106% a month earlier. "U.S. corporate pension plans have maintained their overfunded status for 14 consecutive months since early 2023," said Ned McGuire, managing director at Wilshire, in a news release March 6. "February's increase in...

March 7, 2024
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01Mar

Pension Funding Index February 2024

By Zorast Wadia The funded status of the 100 largest U.S. corporate defined benefit pension plans increased by $12 billion during January as measured by the Milliman 100 Pension Funding Index (PFI). The funding surplus improved to $40 billion as a result of liability decreases that outweighed asset losses during the month. Pension liabilities fell due to an increase in the benchmark corporate bond interest rates used to value those liabilities. As of January 31, the plans’ funded ratio climbed...

March 1, 2024
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February 2024
29Feb

U.S. public pension funding dips in January

The overall estimated funding ratio of the 100 largest U.S. public pension plans fell to 77.7% at the end of January, according to the Milliman 100 Public Pension Funding index. The fall in funding ratio from the year-end number of 78.2% was the result of flat investment returns and rising liabilities. According to Milliman, the aggregate estimated investment return for January was zero, with estimated returns ranging from -1% to 1.1% for the month. "Despite January's lack of investment gains and the...

February 29, 2024
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23Feb

U.S. public pension plans’ average funding ratio declines to 75.4% in 2023: survey

The average funding ratio for U.S. public pension plans declined to 75.4 per cent in 2023, compared to 77.8 per cent in the previous year, according to a new survey by the National Conference on Public Employee Retirement Systems. The report, which was based on responses from nearly 160 public pension funds with roughly US$2.3 trillion in combined assets under management, found the average return for plans was negative 1.9 per cent. The diminished investment returns were attributed to sharp declines...

February 23, 2024
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16Feb

Trends in State and Local Pension Funds

By Oliver Giesecke & Joshua Rauh Unfunded public pension obligations represent the largest liability for state and local governments in the United States. As of fiscal year 2021, the total reported unfunded liabilities of these plans are $1.076 trillion. In contrast, the market value of the unfunded liability is approximately $6.501 trillion. As a result, the reported funding ratio of 82.5% falls to 43.8% under a market-based valuation. The market values reflect the fact that accrued pension promises are a...

February 16, 2024
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13Feb

US Corporate Pension Plans Continue to Improve Funded Status in January

Following a market rally in 2023 that boosted the funded status of corporate defined benefit plans in the U.S., that strength has continued into 2024. According to several pension trackers, the funded status of the plans continued to increase in January. The WTW Pension Index, which tracks the performance and funded status of a hypothetical 60/40 plan, rose to 108.8 in January, up 1.2% from the closing figures from 2023. WTW attributed this performance primarily to a rise in discount rates,...

February 13, 2024
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02Feb

US. Public Pensions Are Mixing Risky Investments with Unrealistic Predictions

More than 20 million Americans are covered by state and local government pensions. Unlike the 401(k) plans found in the private sector, these “defined benefit” plans promise to pay retirees a set amount of money every month for the rest of their lives. For most public workers, these generous programs are a cornerstone of their financial security; for many, they’re one of the main attractions of government jobs. Yet the plans, by their own reckoning, are underfunded to the tune...

February 2, 2024
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