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Corporate pension funding inches up in March — 2 reports

The funded status of U.S. corporate pension plans rose slightly in March on the back of rising discount rates, said reports from Mercer and Aon Hewitt.

The estimated aggregate funding ratio of pension plans sponsored by S&P 1500 companies rose approximately 1 percentage point over the month to 83%, according to Mercer.

The MSCI EAFE index returned -2.3% in March, while the typical discount rate rose eight basis points to 4.01%.

“The current economic and political environment is making plan sponsors frustrated with the lack of progress on the funded status of their pension plans as levels remain similar to where they were eight or nine years ago,” said Jim Ritchie, a partner in Mercer's wealth business, in a news release on the results.

According to the Aon Hewitt Pension Risk Tracker, the aggregate funded status for defined benefit plans sponsored by S&P 500 companies rose 30 basis points to 82.1% in March.

Assets declined 0.24% to $1.688 trillion over the month as assets were mostly negative during the month, ending with a 0.2% return. Liabilities declined by 0.59% to $2.056 trillion in March as discount rates increased five basis points to 3.9%.

Year-to-date through March 31, the funded status is up 1.2 percentage points, according to Aon Hewitt.