Ravenswood Aluminum Corp., which had the highest unfunded liability percentage for the past four years, is off the PBGC's new hit list, released today.
In April, Ravenswood agreed to contribute $100 million to its two pension plans, taking it off the agency's annual list of the largest underfunded pension plans. Also off the list is Uniroyal Goodrich Tire, which had been on seven previous lists. Several new companies were added to the list, including Exxon Corp. and K mart Corp.
Sharply declining interest rates caused underfunding in single-employer pension plans to skyrocket 106% to $64 billion in 1995. The PBGC used a 5.3% interest rate - the lowest rate it has ever used to determine pension underfunding. A year earlier, the PBGC used 7.15%. The agency bases pension underfunding on interest rates and mortality assumptions used to purchase annuities.