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2014 Pension PBO Funded Ratio

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2014 Pension PBO Funded Ratio – 28 Companies with Calendar FY

FR PBO 2014 dec (28)As I’ve been separately exploring in a post looking at plan assets and projected benefit obligations for defined benefit pension plans sponsored by public U.S. corporations, during 2014 the increase in obligations due to lower interest rates outpaced investment gains in assets. The result: a drop in the aggregate pension plan funded ratio, erasing most of the funded ratio increase experienced during 2013.

This chart shows the aggregate pension plan funded ratio determined on the basis of projected benefit obligations for 1995 through 2014 for 28 companies with calendar fiscal years.

Remember my usual general cautionary notes (things that keep getting forgotten or shoved to very tiny print in footnotes in most of the industry reports on this sort of info): (1) these numbers include not only domestic pension plans, but also foreign pension plans, which generally have lower funded ratios than do U.S. pension plans; (2) the numbers include unfunded deferred compensation plans, for which the funded ratio is of course 0%; and (3) PBO numbers include the effect of future compensation increases, producing lower funded ratios than for measurement of the funded status of currently accrued benefits. Which I’ll sort out in future revisions to this post.

I’ll be updating this post as more 10-k reports are filed through the remainder of February 2015, then into March and beyond, retaining earlier versions of the post in backpages, as linked in the numbers at the bottom of this post, with oldest versions carrying the higher numbered links. But as I’ve indicated, the trends for any large group of companies — for instance, pension plan sponsors among the S&P 1500, which is a sample size I’ll have collected before leaving this year’s data set behind — will be very much like the chart shown for these 28 companies.

(As I’ve previously disclaimed, posts such as this represent efforts of my favorite pastime. My formal work does not involve any of this, and none of it represents any position or comment that should in any way be attributed to my employer. Likewise, as always, it represents general personal impressions and should not be treated or used as formal professional advice.)

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Written by macheide

9 February 2015 at 8:20 pm

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