The ability of U.S. corporate defined benefit plans to fund their obligations fell in August, while public plans, foundations and endowments saw a rise in their so-called funded status.
According to the BNY Mellon Investment Strategy and Solutions Group, the drop in corporate pension funding was tied to geopolitical tensions that put downward pressure on interest rates, leading to higher liabilities.
The monthly BNY Mellon Institutional Scorecard indicated that typical corporate plans saw a drop of 0.7 percentage points to 90.1 percent. Liabilities rose 3.3 percent, while the return on assets came in at 2.6 percent.
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