The overall estimated funding ratio of the 100 largest U.S. public pension plans fell to 77.6% at the end of April following a month of negative investment returns, according to the Milliman 100 Public Pension Funding index.
The drop in the funding ratio from the estimate of 79.7% at the end of March was primarily the result of negative market performance in April following positive returns in February and March. At the end of February, Milliman’s estimated funding ratio was 78.6%, and at the end of January, it was 77.7%.
According to Milliman, the aggregate estimated investment return for April was -2.1%, with estimated returns ranging from -3.7% to -0.9% for the month.
“April’s market pullback caused four of the 100 PPFI plans to slip from just above to just below 90% funded,” said Rebecca Sielman, principal and consulting actuary at Milliman and author of the Milliman 100 Public Pension Funding index, in a May 17 news release. “Now only 21 of the plans stand above this key benchmark, while 15 plans—the same number as last month—are less than 60% funded.”
Also as of April 30, a total of 20 pension plans had funding ratios between 60% and 70% (up from 16 at the end of March), 20 plans were between 70% and 80% (up from 18), and 24 plans were between 80% and 90% (down from 26).
Estimated assets fell slightly to $4.864 trillion as of April 30 from $4.983 trillion a month earlier, while liabilities grew to an estimated $6.268 trillion from $6.254 trillion.
