Liabilities Declined More than Assets at Typical Plan
PITTSBURGH, Aug. 6 /PRNewswire-FirstCall/ -- Funding ratios at the typical
U.S. pension plan improved 0.6 percentage points as assets dropped less than
liabilities, according to BNY Mellon Asset Management. Typical pension plan
liabilities fell 1.4 percentage points versus a 0.8 percentage-point decline
for asset returns at a moderate risk portfolio. For the year to date, funding
ratios for typical pension plans have fallen 3.0 percent.
'While Treasury bonds were mixed during July, yields on high-grade
corporate bonds increased and spreads were 19 basis points wider as investors
continued their flight to quality,' said Peter Austin, executive director of
BNY Mellon Pension Services. 'Yields were lower on short-term bonds, but
higher on long-term corporate bonds as they sought balance between growth and
inflation. This month's results reflect a significant improvement over June's
4.8 percent decline in funding ratios, but we haven't seen the end of funding
volatility. Corporate spreads remain extremely wide, and as the markets begin
to settle and corporate spreads narrow, we may see a further decline in
funding ratios.'
Higher yields on longer-term corporate bonds result in lower liabilities
for the typical pension plan
BNY Mellon Asset Management is one of the world's largest global asset
managers with more than US$1 trillion in assets under management. The
multi-boutique asset management model encompasses the investment skills of
world class specialist asset managers who are amongst the most advanced and
highly regarded names in money management. With investment expertise that
spans the asset class spectrum, BNY Mellon Asset Management offers a
comprehensive suite of beta-achieving and alpha-generating investment
strategies to meet the unique needs of institutional investors.
The Bank of New York Mellon Corporation (NYSE: BK) is a global financial
services company focused on helping clients manage and service their financial
assets, operating in 34 countries and serving more than 100 markets. The
company is a leading provider of financial services for institutions,
corporations and high-net-worth individuals, providing superior asset
management and wealth management, asset servicing, issuer services, clearing
services and treasury services through a worldwide client-focused team. It has
more than $23 trillion in assets under custody and administration, more than
$1.1 trillion in assets under management and services $12 trillion in
outstanding debt. Additional information is available at bnymellon.com.
SOURCE The Bank of New York Mellon Corporation
