4/3/2023
U.S. Corporate Pension Plans Funding Status – March 2023
Wilshire estimates less than one percentage point decrease in aggregate funded ratio for U.S. corporate pension plans in March but over one percentage point increase in the first quarter
Santa Monica, Calif., April 3, 2023 – The aggregate funded ratio for U.S. corporate pension plans decreased by an estimated 0.6 percentage points month-over-month in March to end the month at 99.1%, according to Wilshire, a diversified global financial services firm. Through its suite of Outsourced Chief Investment Officer (OCIO) and advisory services, Wilshire assists in providing secure and safe retirements for millions of Americans, including those participating in some of the nation’s largest corporate and public retirement plans.
The monthly change in funded ratio resulted from a 3.4% increase in liability value partially offset by a 2.7% increase in asset value. Although the aggregate funded ratio is estimated to have decreased by 0.6% in March, the aggregate funded ratio is estimated to have increased by 1.6% and 1.4% in the first quarter and over the trailing twelve months, respectively.
“March’s funded status decrease was driven by the increase in liability value resulting from the sharp decrease in fixed income yields. Fixed income yields fell on the heels of the collapse of Silicon Valley Bank with market expectations pivoting to federal funds rate cuts in 2023,” stated Ned McGuire, Managing Director, Wilshire. “Despite the panic spurred by the regional bank crisis in the United States and the Credit Suisse and UBS merger in Switzerland, many financial markets ended March and the first quarter with positive returns. March’s month-end funded ratio estimate of 99.1% indicates that U.S. corporate pension plans are still close to being fully funded in aggregate” Mr. McGuire added.
A 12-month review of the funded ratio follows:
The assumed asset allocation is below:
About Wilshire
Wilshire is a global provider of market-leading indexes, advanced analytics, and multi-asset investment solutions. A trusted partner toa diverse range of more than 500 leading institutional investors and financial intermediaries, our clients rely on us to improve investment outcomes for a better future. Wilshire advises on over $1.3 trillion in assets and manages $83 billion in assets and is headquartered in the United States with offices worldwide.
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