The aggregate funded ratio for US corporate pension plans fell to 85.0 per cent for the month of September 2014, according to Wilshire Consulting.
The decrease in funding was the result of a greater decline in asset values versus a smaller decline in liability value.
“We estimate that overall, the asset value decreased by 2.7 per cent due to negative returns for most asset classes, while the liability value decreased by 2.5 per cent during the month due to rising corporate bond yields,” says Jeff Leonard, managing director, Wilshire Associates, and head of the actuarial services group of Wilshire Consulting.
“Year-to-date, the funded ratio for the sample plan has decreased by 4.8 per cent from 89.8 per cent to 85.0 per cent. This decrease was driven by the larger increase in liability value of 10.0 per cent versus the 4.0 per cent increase in asset value,” Leonard says.