Wilshire Consulting estimates nearly one per cent increase in aggregate funded ratio for US corporate pension plans

US corporate pension plans got a 0.8 percentage point increase in aggregate funded ratio in May, ending the month at 82.0 per cent, according to Wilshire Consulting, the institutional investment advisory and outsourced-CIO business unit of Wilshire Associates Incorporated.

Wilshire Consulting assists in ensuring secure and safe retirements for millions of Americans, including those participating in some of the country's largest corporate and public retirement plans.

The monthly change in funding resulted from a 1.8 per cent increase in asset values partially offset by a 0.8 per cent increase in liability values. The aggregate funded ratio is estimated to have decreased by 6.6 and 5.1 percentage points year-to-date and over the trailing twelve months, respectively.  

“May’s increase in funded ratio was primarily driven by a second consecutive monthly increase for global public equities,” states Ned McGuire, managing director and a member of the Investment Management & Research Group of Wilshire Consulting.

The aggregate figures represent an estimate of the combined assets and liabilities of corporate pension plans sponsored by S&P 500 companies with a duration in line with the FTSE Pension Liability Index – Intermediate. The funded ratio is based on the FTSE – Intermediate liability, with service cost, benefit payments and contributions in line with Wilshire’s 2019 corporate funding study. The most current month-end liability growth is estimated using the Barclays Long Aa+ US Corporate Index.