U.S. corporate pension funding inches up in April – 3 reports
Funding ratios for U.S. corporate pension plans increased in April, according to reports from Wilshire Associates, Legal & General Investment Management America and Mercer.
All three firms noted strong equity markets as the primary driver for the increases, partially offset by a decrease in discount rates leading to rising liability values.
Wilshire’s monthly report said U.S. corporate pension plans’ aggregate funding ratio rose 0.6 percentage points to 92.9% in the month ended April 30. The change was the result of a 2.2-percentage-point increase in asset values partially offset by a 1.7-percentage-point increase in liability values.
April’s funding ratio was the highest Wilshire had estimated since September 2018, said Ned McGuire, managing director and a member of the investment management and research group of Wilshire Associates, in a news release announcing the results.
“April’s increase in funded ratio was driven by positive monthly returns for nearly all asset classes, led by the Wilshire 5000 Total Market index, due to optimism around states beginning to reopen and improving economic data,” Mr. McGuire said.
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