General Electric Co.'s primary pension plan posted a return of -20.5% for the fiscal year ended Dec. 31.
The Boston-based company disclosed the return of the $45 billion GE Pension Plan in its 10-K filing with the SEC on Feb. 10.
For the three, five and 10 years ended Dec. 31, the GE Pension Plan returned an annualized 2.7%, 5.4% and 5.8%, respectively.
The GE Pension Plan returned 9.7% for the fiscal year ended Dec. 31, 2021, according to the company's prior 10-K filing.
GE spokeswoman Micah Stockett said in an email the returns are net of fees and expenses.
For the most recent fiscal year, the pension fund's negative return reflected a challenging market environment. As of Dec. 31, the pension fund's actual allocation to fixed income was 55%, comprised primarily of long-duration corporate bonds, along with U.S. Treasuries, STRIPS and derivatives to hedge liability risks. For the year ended Dec. 31, the Bloomberg Long Corporate Bond index returned -26%. The rest of the pension fund's allocation as of Dec. 31 was 22% private equity and other, 16% global equities and 7% real estate.
Despite the extremely negative investment performance for 2022, the GE Pension Plan's funding ratio only fell to 93.5% from 93.7% a year before because projected benefit obligations for the plan fell as a result of a higher discount rate.
As of Dec. 31, the GE Pension Plan's discount rate was 5.53%, nearly double the discount rate of 2.94% the year before due to rising interest rates. The higher the discount rate, the lower the liabilities.