Skip to main content
MENU
Subscribe
  • Sign Up Free
  • LOGIN
  • Subscribe
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • 2023 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2023 Defined Contribution East Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2023 ESG Investing
    • 2023 Private Markets
Breadcrumb
  1. Home
  2. DEFINED BENEFIT
September 03, 2015 01:00 AM

Corporate pension funding slides in August despite declining liabilities — 2 reports

Meaghan Offerman
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Declining asset values pushed U.S. corporate pension funding levels down in August, said reports from BNY Mellon and Wilshire Consulting.

    The funded status of the typical U.S. corporate pension plan declined 2.5 percentage points to 84.2% in August, said the BNY Mellon Institutional Scorecard.

    Liabilities fell 0.9% over the month, the result of a nine-basis-point increase in the discount rate to 4.44%. However, market turmoil led to a 3.7% decline in assets for corporate DB plans in the month, driving the funded status lower.

    “The second half of August served as a wake-up call to investors who had been lulled to sleep by several months of low volatility in the markets,” said Andrew D. Wozniak, head of fiduciary solutions of the investment strategy and solutions group within BNY Mellon Investment Management, in a news release. On Aug. 24, corporate DB plans' funded status dipped as low as 81.2%.

    That being said, “corporate defined benefit sponsors were somewhat insulated from the full brunt of the volatility due to rising credit spreads, which led to a decline in liabilities,” Mr. Wozniak added. “The decline in asset values that hit typical public defined benefit plans, endowments and foundations was primarily due to poor equity performance across the globe. … Weakness in China is likely to emerge as the culprit behind the declines.”

    In August, public DB plans, and endowments and foundations returned -4.07% and -3.67%, respectively, below their monthly return targets of 0.6% and 0.7%.

    Emerging markets equity and international equity returned -9% and -7.6%, respectively, in the month. On the other end, global fixed income returned 0.1% and emerging markets debt, -1%.

    Separately, Wilshire Consulting found the aggregate funding ratio for U.S. corporate pension plans declined 2.8 percentage points in August to 83.3%, the result of a 4.2% decline in asset values vs. a 0.9% decline in liability values.

    Wilshire Consulting is the institutional investment consulting and outsourced CIO unit of Wilshire Associates.

    Its figures are the result of estimates of combined assets and liabilities of companies in the S&P 500 index that have defined benefit plans.

    The estimated asset allocation is 32% domestic equity, 27% long-duration fixed income, 21% international equity, 18% core fixed income and 2% real estate.

    Related Articles
    Mercer: Equity market turmoil pushes corporate pension funding levels down in A…
    U.K. corporate pension fund deficits fall 4.2% in August
    Milliman: Corporate pension funding drops in August
    Funded status volatility rises the most since 2011 in August
    U.S. pension plans' funded status drops in Q3, two reports find
    Funded status falls in September, down 6 percentage points in quarter — report
    Recommended for You
    R.I. treasurer seeks transparency laws for church plans
    R.I. treasurer seeks transparency laws for church plans
    Public pension funds adopt cost-sharing mechanisms to stem volatility
    Public pension funds adopt cost-sharing mechanisms to stem volatility
    Avery Dennison to terminate U.S. pension plan
    Avery Dennison to terminate U.S. pension plan
    2023 Investment Outlook
    Sponsored Content: 2023 Investment Outlook

    Reader Poll

    March 15, 2023
    SEE MORE POLLS >
    Sponsored
    White Papers
    The Need for Speed in Trend-Following Strategies
    Global Fixed Income: Volatility and Uncertainty Here to Stay
    Morningstar Indexes' Annual ESG Risk/Return Analysis
    2023 Outlook: The Top Five Trends to Monitor in the Year Ahead
    Show Me the Income: Discovering plan sponsor and participant preferences for cr…
    The Future of Infrastructure: Building a Better Tomorrow
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    December 12, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • 2023 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2023 Defined Contribution East Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2023 ESG Investing
      • 2023 Private Markets