Pension Funding Index June 2017

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By Charles J. Clark, Zorast Wadia | 08 June 2017

In May, the funded status of the 100 largest corporate defined benefit plans decreased by $22 billion as measured by the Milliman 100 Pension Funding Index (PFI). The deficit grew to $279 billion from $257 billion at the end of April. As of May 31, the funded ratio fell to 83.8%, down from 84.9% at the end of April.

May’s 0.62% investment return increased Milliman 100 PFI asset values by $4 billion to $1.445 trillion from $1.441 trillion at the end of April.

The projected benefit obligation increased by $26 billion during May, raising the Milliman 100 PFI value to $1.724 billion.

Over the last 12 months (June 2016-May 2017), the cumulative asset return for these pensions has been 8.91% and the Milliman 100 PFI funded status deficit has improved by $102 billion. The primary reason for the increase in the funded status has been investment returns above expectations.