Milliman: 100 largest public DB plans’ funding improves in third quarter on 3.5% return

The funded status of the 100 largest public pension plans rose to an aggregate 71% as of Sept. 30, up 1.2 percentage points from three months earlier, said a quarterly public pension funding study by Milliman released Tuesday.

Assets rose an estimated 2.7% to $3.282 trillion in the three months ended Sept. 30, the result of a 3.5% investment return. Liabilities rose an estimated 0.8% to $4.62 trillion as interest on liabilities and new benefit accruals outpaced benefits paid to retirees.

“While investment returns were healthier than expected, our Milliman 100 plans experienced a wide range of returns, from an estimated low of 1.33% to a high of 4.37%,” said Rebecca A. Sielman, principal and consulting actuary at Milliman and author of the study, in a news release. “Bond funds and commodities generally fared poorly, after having done well in the second quarter. It’s yet to be seen whether they will rebound as we close out the year.”