Single-employer plans: Allocation of assets— Interest assumptions for valuing and paying benefits,

[Federal Register: September 15, 2003 (Volume 68, Number 178)]

[Notices]

[Page 54029-54030]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr15se03-132]

PENSION BENEFIT GUARANTY CORPORATION

Required Interest Rate Assumption for Determining Variable-Rate Premium; Interest Assumptions for Multiemployer Plan Valuations Following Mass Withdrawal

AGENCY: Pension Benefit Guaranty Corporation.

ACTION: Notice of interest rates and assumptions.

SUMMARY: This notice informs the public of the interest rates and assumptions to be used under certain Pension Benefit Guaranty Corporation regulations. These rates and assumptions are published elsewhere (or can be derived from rates published elsewhere), but are collected and published in this notice for the convenience of the public. Interest rates are also published on the PBGC's Web site (http://www.pbgc.gov).

DATES: The required interest rate for determining the variable-rate premium under part 4006 applies to premium payment years beginning in September 2003. The interest assumptions for performing multiemployer plan valuations following mass withdrawal under part 4281 apply to valuation dates occurring in October 2003.

FOR FURTHER INFORMATION CONTACT: Harold J. Ashner, Assistant General Counsel, Office of the General Counsel, Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, DC 20005, 202-326-4024. (TTY/TDD users may call the Federal relay service toll-free at 1-800- 877-8339 and ask to be connected to 202-326-4024.)

SUPPLEMENTARY INFORMATION:

Variable-Rate Premiums

Section 4006(a)(3)(E)(iii)(II) of the Employee Retirement Income Security Act of 1974 (ERISA) and Sec. 4006.4(b)(1) of the PBGC's regulation on Premium Rates (29 CFR part 4006) prescribe use of an assumed interest rate (the ``required interest rate'') in determining a single-employer plan's variable-rate premium. The required interest rate is the ``applicable percentage'' (currently 100 percent) of the annual yield on 30-year Treasury securities for the month preceding the beginning of the plan year for which premiums are being paid (the ``premium payment year''). (Although the Treasury Department has ceased issuing 30-year securities, the Internal Revenue Service announces a surrogate yield figure each month--based on the 30-year Treasury bond maturing in February 2031--which the PBGC uses to determine the required interest rate.)

The required interest rate to be used in determining variable-rate premiums for premium payment years beginning in September 2003 is 5.31 percent.

The following table lists the required interest rates to be used in determining variable-rate premiums for premium payment years beginning between October 2002 and September 2003.

The required For premium payment years beginning in:

interest rate is:

October 2002................................................. 4.76 November 2002................................................ 4.93 December 2002................................................ 4.96 January 2003................................................. 4.92 February 2003................................................ 4.94 March 2003................................................... 4.81 April 2003................................................... 4.80 May 2003..................................................... 4.90 June 2003.................................................... 4.53 July 2003.................................................... 4.37

[[Page 54030]]

August 2003.................................................. 4.93 September 2003............................................... 5.31

Multiemployer Plan Valuations Following Mass Withdrawal

The PBGC's regulation on Duties of Plan Sponsor Following Mass Withdrawal (29 CFR part 4281) prescribes the use of interest assumptions under the PBGC's regulation on Allocation of Assets in Single-Employer Plans (29 CFR part 4044). The interest assumptions applicable to valuation dates in October 2003 under part 4044 are contained in an amendment to part 4044 published elsewhere in today's Federal Register. Tables showing the assumptions applicable to prior periods are codified in appendix B to 29 CFR part 4044.

Issued in Washington, DC, on this 8th day of September, 2003. Joseph H. Grant, Deputy Executive Director and Chief Operating Officer, Pension Benefit Guaranty Corporation.

[FR Doc. 03-23366 Filed 9-12-03; 8:45 am]

BILLING CODE 7708-01-P