Milliman: Corporate pension funded status drops by $5B in July

The balance sheets for the nation’s largest defined benefit pension plans deteriorated in July, according to new research.

Milliman Inc., a global consulting and actuarial firm disclosed today the results of its latest Pension Funding Index (PFI), which consists of 100 of the nation’s largest defined benefit pension plans. In July, these plans experienced a $3 billion decrease in pension liabilities and an $8 billion decrease in asset value, resulting in a $5 billion increase in the pension funded status deficit.

“For months it’s been interest rates driving up the deficit, but in July the rates cooperated and it was instead poor financial market performance negatively impacting funded status,” says John Ehrhardt, co-author of the Milliman 100 Pension Funding Index. “We’ve seen the deficit increase by more than $70 billion so far in 2014.”