PBGC Adds $300 Million in Pension Liabilities To Its Books

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The Pension Benefit Guaranty Corporation (PBGC) has taken on $300 million in pension liabilities in recent days – the result of guaranteeing the retirement benefits of 8,500 employees of the now-bankrupt Standard Register.

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PBGC estimates put the Standard Register plan at less than half funded, or 47 percent, with $289 million in assets to pay about $611 million in pension liabilities.

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Symptoms of distress began showing early this year when Standard Register hired three firms to help restructure its debt. Its CFO left the company abruptly in March. The company was also late in releasing its fourth quarter 2014 earnings.

Later last March, the company filed for bankruptcy protection, and in July 2015 a bankruptcy court authorized sale of the company to Taylor for about $307 million. The company had operations in all 50 states and had about 3,500 employees.

Its pension plan–the Stanreco Retirement Plan—officially ended August 31, 2015, according to PBGC.

PBGC will cover all earned pension benefits up to the maximum of $60,136 for a 65-year old retiree.

The PBGC acts as insurance on private defined-benefit plans; if a plan fails, the agency will pay benefits to the recipients up to a certain threshold.

 

Photo by c_ambler via Flickr CC License

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