The overall estimated funding ratio of the 100 largest U.S. public pension plans rose to 74.7% at the end of November thanks to positive market returns, according to the Milliman 100 Public Pension Funding index.
During the month of November, Milliman estimated that public pension plans had an aggregate investment return of 4.7%, with an estimated range of 2.5% to 7.2%.
It was the second month in a row that estimated funding ratios rose because of market returns. Milliman estimated that the overall ratio had risen to 71.6% as of Oct. 31 from 69.3% a month earlier.
During the month of October, Milliman estimated that public pension plans had an aggregate investment return of 2.8%, with an estimated range of -1.3% to 5.3%.
"Market improvements over the past two months pushed seven plans above the 90% funded mark as of Nov. 30 — a reversal from September, when seven plans slipped below this milestone," said Rebecca A. Sielman, principal and consulting actuary at Milliman and author of the Milliman 100 Public Pension Funding index, in a news release Wednesday. "Nineteen plans are now more than 90% funded, and while this is still well below the 46 plans at this level at the end of 2021, it points to an overall positive trend in public pension plan health."
A total of 24 plans were estimated to be below 60% as of Nov. 30, the same as Sept. 30 when Milliman last released public pension funding index data.
Also as of Nov. 30, a total of 16 plans had ratios between 60% and 70% (up from 15 as of Sept. 30), 18 plans were between 70% and 80% (down from 26) and 23 plans were between 80% and 90% (up from 16).
As a result of two months of positive market returns, estimated assets rose to $4.417 trillion as of Nov. 30 from $4.075 trillion two months earlier, while estimated liabilities rose slightly to an estimated $5.913 trillion from $5.883 trillion.