The funded status of corporate defined benefit pension plans could be as low as 46%, despite reporting to the SEC a median of 69% as of June 30, according to an analysis by research firm FutureMetrics.
The lower funded status in FutureMetrics’ analysis of the data submitted by the plans to the SEC employs a proprietary algorithm, using the discount rate based on 30-year Treasuries plus 0.5% for a median salary inflation rate, to recalculate the funded status reported by roughly 600 companies. The DB plans calculate their funded status based on the assets vs. liabilities in their SEC filings.
In March, the research firm estimated the median funded level was 50% using its proprietary algorithm method.
The companies that reported to FutureMetrics had a combined $1.48 trillion in pension assets and represent about 92% of all U.S. corporate pension plan assets, FutureMetrics President William Strauss said in an interview.
The full report can be found at http://www.futuremetrics.com.
FutureMetrics also announced it is considering discontinuing its pension plan data products because of a “dramatic drop in licensing fee income.”
“We have been providing this data since 1992 but have lost most of our paying customers in the last 18 months,” according to the report. “We have several options: selling the entire database and passing on this part of our business to someone else for internal use, or charging for these periodic updates.”
The firm is soliciting comments about the possible discontinuation of the report at [email protected]