Pension Plan funds drop in October

Funding ratios at the typical U.S. corporate pension plan fell 3.7 percentage points in October as stocks had their worst month since 1987, according to BNY Mellon Asset Management. For the year to date, funding ratios for typical plans have declined approximately 7.7 percent.

“Renewed recession fears weakened an already fragile market, as the value of the assets in a moderate-risk portfolio declined 11.8 percentage points in October,” says Peter Austin, executive director of BNY Mellon Pension Services. “The impact of this dramatic drop in asset values was partially offset by a 7.3 percentage point drop in typical plan liabilities, as the Pension Protection Act average discount rates rose 76 basis points.”