Wilshire estimates no change in aggregated funded ratio of US corporate pension pans in October
The aggregate funded ratio for US corporate pension plans remained unchanged month-over-month in October to end the month at 82.9 per cent, according to Wilshire Associates (Wilshire), a diversified global financial services firm.
Through its suite of Outsourced Chief Investment Officer (OCIO) and advisory services, Wilshire assists in ensuring secure and safe retirements for millions of Americans, including those participating in some of the nation’s largest corporate and public retirement plans.
October’s funded ratio resulted from a 2.0 percentage point decrease in asset values offset by a 2.0 percentage point decrease in liability values. Over longer periods, the aggregate funded ratio is estimated to have decreased by 4.2 and 5.4 percentage points year-to-date and over the trailing twelve months, respectively, primarily due to rising liability values.
“October’s funded ratio was driven on one hand by negative returns for most asset classes, especially the continued decline in global public equity, but it was offset by the decrease in liability values as corporate bond yields used to value corporate pension liabilities increased by over 10 basis points,” says Ned McGuire, Managing Director, Wilshire Associates.