The funded status deficit of American pension plans increased by US$102 billion in the third quarter of 2015, a shift from the previous quarter that saw the deficit decline by US$81 billion.
Year-to-date, the funded status deficit has increased by US$40 billion.
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Data from the Aon Hewitt Pension Risk Tracker, which evaluates daily funded status for S&P 500 companies with DB plans, shows the aggregate funded ratio decreased from 83.5% to 78.7%. The change was largely driven by asset reductions of US$79 billion along with liability increases of US$23 billion year to date.
“Volatility in equity markets—particularly poor performance in August—drove the decline in funded status for the quarter,” said Ari Jacobs, Global Retirement Solutions leader at Aon Hewitt.
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