The funded status of S&P 1500 companies defined benefit plans withstood further equity value declines in February to barely fall, according to Mercer.
The plans funded status was 74% as of Feb. 28, down slightly from 75% at the end of January, with an aggregate estimated deficit of $373 billion, just below the $380 billion as of Jan. 31 and the $409 billion at the end of 2008, Mercer said in a news release.
Although equity markets declined, reducing the value of plan assets, bond yields increased which also reduced the value of plan liabilities, Adrian Hartshorn, principal in Mercers financial strategy group, said in the news release. The net result was virtually no change in funded status, the difference in the value of plan assets and the value of plan obligations.
Mr. Hartshorn added that since most plan sponsors use year-end information to calculate pension expense and contribution requirements, many need to find ways to address deficits that now exist in order to affect 2010 pension expense and contribution assumptions.