Milliman Analysis Indicates Sixth Straight Month of Pension Funding Declines

Assets decrease by $7 billion during October while liabilities decrease by $3 billion

• Press Release
• Source: Milliman, Inc.
• On 3:35 pm EST, Tuesday November 10, 2009

SEATTLE, Nov. 10 /PRNewswire/ -- Milliman, Inc., one of the premier global consulting and actuarial firms, today released the latest update to the Milliman 100 Pension Funding Index, which consists of 100 of the nation's largest defined benefit pension plans. In October, pensions experienced asset decreases of $7 billion and liability decreases of roughly $3 billion, resulting in a $4 billion decrease in funded status. The funded ratio decreased from 75.3% to 75%.

"We've seen six months and counting of pension funding declines," said John Ehrhardt, co-author of the Milliman 100 Pension Funding Index. "This month, though, we saw a reversal of the recent pattern, with the decline driven by a reduction in assets rather than by an increase in liabilities, as has been the case for several months prior."

Over the last 12 months, the cumulative asset return has been 9.12% and the funded status has fallen by $68 billion. For these 12 months, the funded ratio of the Milliman 100 companies has fallen from 93.8% to 75.0%.

To view the complete monthly update, go to www.milliman.com/expertise/employee-benefits/products-tools/pension-funding-study/index.php.

About Milliman

Milliman is among the world's largest independent actuarial and consulting firms. Founded in Seattle in 1947 as Milliman & Robertson, the company currently has 50 offices in key locations worldwide. Milliman employs more than 2100 people, with a professional staff of more than 1100 qualified consultants and actuaries, including specialists ranging from clinicians to economists. The firm has consulting practices in healthcare, employee benefits, property and casualty insurance, life insurance, and financial services. Milliman serves the full spectrum of business, financial, government, union, education, and nonprofit organizations. For further information, visit www.milliman.com.

About the Milliman 100 Pension Funding Index

For the past nine years, Milliman has conducted an annual study of the 100 largest defined benefit pension plans sponsored by U.S. public companies. The Milliman 100 Pension Funding Index projects the funded status for pension plans included in our study, reflecting the monthly impact of market returns and interest-rate changes on pension funded status, utilizing the actual reported asset values, liabilities, and asset allocations of the companies' pension plans.

The results of the Milliman 100 Pension Funding Index were based on the actual pension plan accounting information disclosed in the footnotes to the companies' annual reports for the preceding fiscal year and for previous fiscal years. In addition to providing the financial information on the funded status of U.S. qualified pension plans, the footnotes may also include figures for the companies' nonqualified and foreign plans, both of which are often unfunded or subject to funding standards different from those for U.S. qualified pension plans. The results do not represent the funded status of the companies' U.S. qualified pension plans under ERISA.

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