Ameriprise 2009 Annual Report Download - page 153
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The fair value of the Company’s pension plan assets at December 31, 2009 was as follows:
Asset Category Level 1 Level 2 Level 3 Total
(in millions)
Equity securities:
U.S. large cap stocks $ 56 $ — $ — $ 56
U.S. small cap stocks 22 — — 22
Non-U.S. large cap stocks 10 17 — 27
Emerging markets 13 11 — 24
Debt securities:
U.S. investment grade bonds 15 10 — 25
U.S. high yield bonds — 11 — 11
Non-U.S. investment grade bonds — 14 — 14
Private real estate investment trust — — 5 5
Pooled pension funds — 63 — 63
Cash equivalents 9 — — 9
Total $ 125 $ 126 $ 5 $ 256
Equity securities are managed to track the performance of common market indices for both U.S. and non-U.S. securities, primarily across
large cap, small cap and emerging market asset classes. Debt securities are managed to track the performance of common market indices
for both U.S. and non-U.S. investment grade bonds as well as a pool of U.S. high yield bonds. The private real estate investment trust
consists of a single trust which is managed to track the performance of a broad population of investment grade non-agricultural income
producing properties. Pooled pension funds are managed to a return of 1.5% in excess of a common index of similar pooled pension funds
on a rolling three year basis. Cash equivalents consist of holdings in a money market fund that seeks to equal the return of the three month
Treasury bill.
The fair value of the private real estate investment trust is based primarily on the underlying cash flows of the properties within the trust
which are significant unobservable inputs and classified as Level 3. The fair value of pooled pension funds and collective trust funds is
based on the fund’s NAV and classified as Level 2 as they trade in principal-to-principal markets. Equity securities and mutual funds
traded in active markets are classified as Level 1. For debt securities and cash equivalents, the valuation techniques and classifications are
consistent with those used for the Company’s own investments as described in Note 18.
The following table provides a summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis:
Private
Real Estate
Asset Category Investment Trust
Balance at January 1, 2009 $7
Actual return on plan assets:
Relating to assets still held at the reporting date (2)
Purchases, sales, and settlements, net —
Balance at December 31, 2009 $5
The Company’s retirement plans expect to make benefit payments to retirees as follows:
(in millions)
2010 $47
2011 41
2012 42
2013 44
2014 48
2015-2019 209
The Company expects to contribute $66 million to its pension plans in 2010.
138 ANNUAL REPORT 2009