In March, the funded status of the 100 largest corporate defined benefit pension plans increased by $28 billion as measured by the Milliman 100 Pension Funding Index (PFI). The deficit decreased to $247 billion from $275 billion at the end of February due to robust asset returns and an increase in the benchmark corporate bond interest rates used to value pension liabilities. As of March 31, the funded ratio improved to 85.3%, up from 83.8% at the end of February.
March’s 1.55% investment return increased Milliman 100 PFI asset values by $11 billion to $1.434 trillion.
The projected benefit obligation decreased by $17 billion during March, lowering the Milliman 100 PFI value to $1.681 trillion. The change resulted from an increase of eight basis points in the monthly discount rate to 3.96% for March from 3.88% in February.
For the quarter ended March 31, 2017, there was a net investment gain of 3.80%. Since the start of 2017, Milliman 100 PFI asset values have risen by $37 billion due to strong returns each month. The funded ratio of the Milliman 100 companies increased to 85.3% at the end of March 2017 from 83.3% at the end of December 2016.