U.S. corporate pension plan buyout sales totaled $4.6 billion in the third quarter, a LIMRA Secure Retirement Institute sales survey found.
The amount for the quarter was 41% lower than the same period in 2019, which saw $7.7 billion in buyout volume, but it does represent double the $2.3 billion in volume for the quarter ended June 30.
Buyout activity has traditionally taken place in the second half of calendar years.
For the nine months ended Sept. 30, buyout sales totaled $11.3 billion, a drop of 32% compared with $16.7 billion during the same period in 2019.
There were 106 group buyout contracts sold during the third quarter, down 5% from the third quarter of 2019.
LIMRA also said there was one buy-in contract, worth $209 million, in the third quarter. While the survey did not identify the transaction, Boise Cascade Co., Boise, Idaho, announced on Aug. 14 in an SEC filing that it had signed a pension buy-in contract with Prudential Insurance Co. of America on Aug. 5, with an agreement to convert it to a pension buyout following a lump-sum offer to participants to complete the termination of that plan.
That lone buy-in for the quarter also was the first U.S. pension buy-in contract of 2020, according to LIMRA.
Pension buyout volume is increasing after a slowdown caused by the COVID-19 pandemic, Mark Paracer, assistant research director of the Secure Retirement Institute, said in a news release announcing the survey results. "We are hearing from the carriers that the volume is picking up. The fourth quarter is typically a busy time as plan sponsors look to close out deals by the year-end. We expect this trend to continue in 2020," Mr. Paracer said.
LIMRA surveyed the 17 financial services companies that provide all the group annuity contracts for U.S. corporate pension plans.
