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DEFINED BENEFIT

Caterpillar digs up $450 million contribution for global DB plans in 2017

Caterpillar Inc., Peoria, Ill., plans to contribute $450 million to its defined benefit plans in 2017, said the company's recent 10-K filing.

The company expects to contribute $350 million to its U.S. pension funds and $100 million to its non-U.S. pension funds.

In 2016, Caterpillar contributed $36 million to its U.S. plans and $117 million to its non-U.S. plans.

U.S. defined benefit assets totaled $11.35 billion and liabilities, $16.22 billion, for a funding ratio of 70% as of Dec. 31, down from 72.4% at the end of 2015.

Non-U.S. DB assets totaled $3.89 billion and liabilities, $4.47 billion, for a funding ratio of 87% as of Dec. 31, down from 89.3% the previous year.

The discount rate used to measure benefit obligations was 4% for the U.S. plans, down from 4.2% at the end of 2015. The discount rate for the non-U.S. plans was 2.5%, down from 3.2% in 2015.

As of the Dec. 31, the U.S. plans had an asset allocation of 38.7% U.S. corporate bonds, 26.4% U.S. equities, 14.6% non-U.S. equities, 6.25% non-U.S. corporate bonds, 5.7% U.S. government bonds, 4.3% U.S. governmental agency mortgage-backed securities, 3.2% cash, 0.8% non-U.S. government bonds and 0.1% real estate.

The non-U.S. plans had an asset allocation of 30.2% non-U.S. government bonds, 20.5% non-U.S. equities, 13.2% U.S. equities, 10.8% global fixed income, 9.2% non-U.S. corporate bonds, 4.6% real estate, 4% global equities, 3.9% U.S. corporate bonds, 1.1% U.S. government bonds and the remainder in cash.