Allocation of Assets in Single-Employer Plans; Interest Assumptions for Valuing Benefits

Citation88 FR 62706
Published date13 September 2023
Record Number2023-19803
CourtPension Benefit Guaranty Corporation
SectionRules and Regulations
Federal Register, Volume 88 Issue 176 (Wednesday, September 13, 2023)
[Federal Register Volume 88, Number 176 (Wednesday, September 13, 2023)]
                [Rules and Regulations]
                [Page 62706]
                From the Federal Register Online via the Government Publishing Office []
                [FR Doc No: 2023-19803]
                29 CFR Part 4044
                Allocation of Assets in Single-Employer Plans; Interest
                Assumptions for Valuing Benefits
                AGENCY: Pension Benefit Guaranty Corporation.
                ACTION: Final rule.
                SUMMARY: This final rule amends the Pension Benefit Guaranty
                Corporation's regulation on Allocation of Assets in Single-Employer
                Plans to prescribe interest assumptions under the asset allocation
                regulation for plans with valuation dates in the fourth quarter of
                2023. These interest assumptions are used for valuing benefits under
                terminating single-employer plans and for other purposes.
                DATES: Effective October 1, 2023.
                FOR FURTHER INFORMATION CONTACT: Gregory Katz ([email protected]),
                Attorney, Office of the General Counsel, Pension Benefit Guaranty
                Corporation, 445 12th Street SW, Washington, DC 20024-2101, 202-229-
                3829. If you are deaf or hard of hearing, or have a speech disability,
                please dial 7-1-1 to access telecommunications relay services.
                SUPPLEMENTARY INFORMATION: PBGC's regulation on Allocation of Assets in
                Single-Employer Plans (29 CFR part 4044) prescribes actuarial
                assumptions--including interest assumptions--for valuing benefits under
                terminating single-employer plans covered by title IV of the Employee
                Retirement Income Security Act of 1974 (ERISA). The interest
                assumptions in the regulation are also published on PBGC's website
                 PBGC uses the interest assumptions in appendix B to part 4044
                (``Interest Rates Used to Value Benefits'') to determine the present
                value of annuities in an involuntary or distress termination of a
                single-employer plan under the asset allocation regulation. The
                assumptions are also used to determine the value of multiemployer plan
                benefits and certain assets when a plan terminates by mass withdrawal
                in accordance with PBGC's regulation on Duties of Plan Sponsor
                Following Mass Withdrawal (29 CFR part 4281).
                 The fourth quarter 2023 interest assumptions will be 5.06 percent
                for the first 20 years following the valuation date and 4.37 percent
                thereafter. In comparison with the interest assumptions in effect for
                the third quarter of 2023, these interest assumptions represent no
                change in the select period (the period during which the select rate
                (the initial rate) applies), a decrease of 0.18 percent in the select
                rate, and a decrease of 0.21 percent in the ultimate rate (the final
                Need for Immediate Guidance
                 PBGC has determined that notice of, and public comment on, this
                rule are impracticable, unnecessary, and contrary to the public
                interest. PBGC routinely updates the interest assumptions in appendix B
                of the asset allocation regulation each quarter so that they are
                available to value benefits. Accordingly, PBGC finds that the public
                interest is best served by issuing this rule expeditiously, without an
                opportunity for notice and comment, and that good cause exists for
                making the assumptions set forth in this amendment effective less than
                30 days after publication to allow the use of the proper assumptions to
                estimate the value of plan benefits for plans with valuation dates
                early in the fourth quarter of 2023.
                 PBGC has determined that this action is not a ``significant
                regulatory action'' under the criteria set forth in Executive Order
                 Because no general notice of proposed rulemaking is required for
                this amendment, the Regulatory Flexibility Act of 1980 does not apply.
                See 5 U.S.C. 601(2).
                List of Subjects in 29 CFR Part 4044
                 Employee benefit plans, Pension insurance, Pensions.
                 In consideration of the foregoing, 29 CFR part 4044 is amended as
                1. The authority citation for part 4044 continues to read as follows:
                 Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.
                2. In appendix B to part 4044, an entry for ``October-December 2023''
                is added at the end of the table to read as follows:
                Appendix B to Part 4044--Interest Rates Used to Value Benefits
                * * * * *
                 The values of i are:
                 For valuation dates -----------------------------------------------------------------------------------
                 occurring in the month-- i for t = i for t = i for t =
                 * * * * * * *
                October-December 2023....... 0.0506 1-20 0.0437 >20 N/A N/A
                 Issued in Washington, DC.
                Hilary Duke,
                Assistant General Counsel for Regulatory Affairs, Pension Benefit
                Guaranty Corporation.
                [FR Doc. 2023-19803 Filed 9-12-23; 8:45 am]
                BILLING CODE 7709-02-P

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT