By: Russ Kamp, Managing Director, Ryan ALM, Inc.

There is nothing new to report for the second consecutive week. There were no new applications received, denied, withdrawn, or approved, and no new non-priority plans added to the waiting list. I’m sure that there is a lot going on behind the scenes, but the waiting must be frustrating for the roughly 130 pension plans that are still in the queue to have their applications reviewed/approved.

I am under the impression that some of the delay may be related to ensuring that the census data that was provided in each application is accurate. I would imagine that becomes a very tedious process, especially for some of these plans with 1,000s and 1,000s of participants. Unfortunately, the delay in processing these applications has a real cost to it, as Treasury yields have plummeted during the last 6 weeks. The lower yields elevate the present value (PV) cost of those future value (FV) benefit payments that are to be made by the Special Financial Assistance (SFA). The greater cost reduces the coverage period and the security that comes with a fully defeased benefit.