US Bank 2014 Annual Report Download - page 121

such additional amounts as the Company determines to be
appropriate. The Company made contributions of $475
million and $296 million to its pension plan in 2014 and 2013,
respectively, and does not anticipate making contributions to
its pension plan in 2015. Any contributions made to the
qualified plans are invested in accordance with established
investment policies and asset allocation strategies.
In addition to the funded qualified pension plans, the
Company maintains non-qualified plans that are unfunded
and provide benefits to certain employees. The assumptions
used in computing the accumulated benefit obligation, the
projected benefit obligation and net pension expense are
substantially consistent with those assumptions used for the
funded qualified plans. In 2015, the Company expects to
contribute $21 million to its non-qualified pension plans
which equals the 2015 expected benefit payments.
Postretirement Welfare Plan In addition to providing
pension benefits, the Company provides health care and
death benefits to certain former employees who retired prior
to January 1, 2014. Employees retiring after December 31,
2013, are not eligible for retiree health care benefits. This
plan change decreased the plan’s benefit obligation by $35
million during 2013, and is subsequently being amortized as
a reduction to plan expense over the remaining life of the
plan participants. The Company expects to contribute $7
million to its postretirement welfare plan in 2015.
The following table summarizes the changes in benefit obligations and plan assets for the years ended December 31, and the
funded status and amounts recognized in the Consolidated Balance Sheet at December 31 for the retirement plans:
Pension Plans
Postretirement
Welfare Plan
(Dollars in Millions) 2014 2013 2014 2013
Change In Projected Benefit Obligation
Benefit obligation at beginning of measurement period ..................................... $ 3,895 $ 4,096 $100 $142
Service cost ................................................................................. 152 168 – 3
Interest cost ................................................................................. 197 170 3 4
Participants’ contributions .................................................................. – – 11 10
Plan amendments ........................................................................... – – – (35)
Actuarial loss (gain) ......................................................................... 781 (388) 13 (2)
Lump sum settlements(a) .................................................................... (286) (34) – –
Benefit payments ............................................................................ (127) (117) (25) (24)
Federal subsidy on benefits paid ............................................................ ––22
Benefit obligation at end of measurement period(b) .......................................... $ 4,612 $ 3,895 $104 $100
Change In Fair Value Of Plan Assets
Fair value at beginning of measurement period ............................................. $ 2,831 $ 2,321 $ 92 $105
Actual return on plan assets ................................................................ 269 343 – –
Employer contributions...................................................................... 500 318 7 1
Participants’ contributions .................................................................. – – 11 10
Lump sum settlements(a) .................................................................... (286) (34) – –
Benefit payments ............................................................................ (127) (117) (25) (24)
Fair value at end of measurement period .................................................... $ 3,187 $ 2,831 $ 85 $ 92
Funded (Unfunded) Status ............................................................. $(1,425) $(1,064) $ (19) $ (8)
Components Of The Consolidated Balance Sheet
Current benefit liability ...................................................................... $ (21) $ (20) $ – $ –
Noncurrent benefit liability .................................................................. (1,404) (1,044) (19) (8)
Recognized amount ......................................................................... $(1,425) $(1,064) $ (19) $ (8)
Accumulated Other Comprehensive Income (Loss), Pretax
Net actuarial gain (loss) ..................................................................... $(1,894) $(1,333) $ 55 $ 75
Net prior service credit (cost) ................................................................ 11 16 31 34
Recognized amount ......................................................................... $(1,883) $(1,317) $ 86 $109
(a) 2014 includes $242 million of payments as a result of a bulk lump sum offering to certain deferred vested participants.
(b) At December 31, 2014 and 2013, the accumulated benefit obligation for all pension plans was $4.3 billion and $3.6 billion, respectively.
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