The combined funded status of the 100 largest U.S. corporate defined benefit pension plans studied by Milliman decreased $62 billion in August, dropping the funded ratio to 79.3% from 83%.
The plans lost a total of $29 billion on investments and saw a $33 billion increase in liabilities, increasing the combined deficit to $314 billion from $252 billion in July, according to a Milliman news release.
“It’s been another rough summer,” John Ehrhardt, principal, consulting actuary and co-author of the Milliman 100 index, said in the news release. “While the August results are discouraging, these pensions ended the month with a rally when you consider that, as of Aug. 8, the deficit had ballooned by $97 billion in just five business days. With volatility on the asset side continuing, and no sign of interest rates rising anytime soon, we may be in for more turbulent times.”
The aggregate assets of the plans totaled $1.206 trillion in August, down from $1.235 trillion, according to Milliman.
Mr. Ehrhardt could not be reached for more information by press time.