Moody’s has issued a “credit negative” warning for sponsors of multiemployer pension plans, in light of the $10 billion increase in the Pension Benefit Guaranty Corps.’ multiemployer insurance program’s projected deficit.
While not a universal downgrade, the warning suggests that the inevitability of yet further increases in sponsors’ premiums to PBGC will affect the credit worthiness of some companies.
In PBGC's fiscal year 2015 annual report, released in November, PBGC said the multiemployer insurance program, which partially backs the pension promises to roughly 10 million participants in collectively bargained multiemployer pension programs, now has a deficit of $52.3 billion.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
