The funding ratio for the typical U.S corporate defined benefit plan rose 7 percentage points in the fourth quarter to 84%, according to a UBS Global Asset Management report.
The 84% funding ratio as of Dec. 31 was the same as a year earlier, Kris Kagel, a UBS spokesman, said in an e-mailed response to questions.
In the latest quarter, assets were up 4% while liabilities declined by 4%. For the year, assets rose 10%, with liabilities increasing by the same percentage, “resulting in no material funding ratio improvement for the typical pension plan,” according to a UBS news release.
The fourth-quarter funding increase was achieved in part “by strong performance across most risky asset markets throughout the quarter,” aided by “lower liability values due to a sharp sell-off in interest rates, particularly in the latter part of the quarter,” the news release said.