By: Russ Kamp, CEO, Ryan ALM, Inc.

If I based this ARPA update on the weather currently in New Jersey, I’d imagine that I was providing perspective on the latest comings and goings from the PBGC in July or August. This heat is shocking, but the volatility in the weather is more like our current capital markets than the season’s that I experienced in my youth.

As previously mentioned, the PBGC is nearing completion implementing ARPA, at least regarding the original candidates for SFA, whether they be members of priority groups or the waitlist candidates. I still have very little knowledge of how the Mass Withdrawal funds will be treated.

As a result of the PBGC’s effort to date, there will be little information to provide on a weekly basis. As for this latest period, only one fund, Production Workers Pension Fund, withdrew its initial application. They’d been seeking $23.1 million for only 281 plan participants. They have until year-end to resubmit another application.

There is little else to report. Currently, there are seven revised applications with the PBGC. In total, they are hoping to receive $222.4 million in SFA for nearly 11k members. The eFiling portal remains temporarily closed, but with only one non-mass withdrawal applicant currently on the waitlist, that doesn’t pose too much of an obstacle.

Importantly, U.S. interest rates continue to rise fairly rapidly, with the 30-year Treasury Bond yield at 5.18% (10:19 am). Comparable maturity investment-grade bonds are yielding >6%. These rates provide plans with a great opportunity to defease the promised benefit payments with certainty (baring a default).