HopFed Bancorp Inc., Hopkinsville, Ky., will terminate its defined benefit plan and distribute the $3.6 million in assets to participants, said John E. Peck, president and CEO. "The plan was very expensive, and the employee perception of the benefit was very low, he said.
Diversified Investment Advisors managed the assets in long-term government bonds, said Billy Duvall, CFO.
Only three employees elected to roll over their proceeds in the companys existing 401(k), which has less than $1 million in total assets in investment options offered by bundled provider Manulife as well as other managers, Mr. Duvall said. The other employees placed their proceeds in self-directed IRAs, he said.
"Wed have liked to see that number (in 401(k) rollovers) a little higher, Mr. Duvall said. "But thats why we have a 401(k), to let people have a choice.
The distribution should be completed in a few weeks.