96-20846. Interest Assumption for Determining Variable-Rate Premium; Interest Assumptions for Multiemployer Plan Valuations Following Mass Withdrawal

[Federal Register Volume 61, Number 159 (Thursday, August 15, 1996)]
[Notices]
[Pages 42448-42449]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-20846]


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PENSION BENEFIT GUARANTY CORPORATION


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

AGENCY: Pension Benefit Guaranty Corporation.


[[Page 42449]]


ACTION: Notice of interest rates and assumptions.

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SUMMARY: This notice provides information about interest rates and 
assumptions to be used for calculating the variable-rate premium 
payable to the Pension Benefit Guaranty Corporation and for valuing 
benefits in multiemployer plans following a mass withdrawal. These 
rates and assumptions are published elsewhere (or are derivable from 
rates published elsewhere); the PBGC furnishes the information in this 
notice simply for the convenience of the public. Interest rates are 
also published on the PBGC's home page (http://www.pbgc.gov).

DATES: The interest rate for determining the variable-rate premium 
under part 4006 applies to premium payment years beginning in August 
1996. The interest assumptions for performing multiemployer plan 
valuations following mass withdrawal under part 4281 apply to valuation 
dates occurring in September 1996.

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 
(202-326-4179 for TTY and TDD).

SUPPLEMENTARY INFORMATION:

Variable-Rate Premiums

    Section 4006(a)(3)(E)(iii)(II) of the Employee Retirement Income 
Security Act of 1974 and Sec. 4006.4(b)(1) of the PBGC's regulation on 
Premium Rates (29 CFR part 4006) prescribes use of an assumed interest 
rate in determining a single-employer plan's variable-rate premium. The 
rate is a specified percentage (currently 80 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''). The yield figure is reported in Federal 
Reserve Statistical Releases G.13 and H.15.
    The assumed interest rate to be used in determining variable-rate 
premiums for premium payment years beginning in August 1996 (i.e., 80 
percent of the yield figure for July 1996) is 5.62%. The following 
table lists the assumed interest rates to be used in determining 
variable rate premiums for premium payment years beginning in the one-
year period ending with August 1996.

------------------------------------------------------------------------
                                                                  The   
                                                                required
            For premium payment years beginning in              interest
                                                                rate is 
------------------------------------------------------------------------
September 1995...............................................       5.49
October 1995.................................................       5.24
November 1995................................................       5.10
December 1995................................................       5.01
January 1996.................................................       4.85
February 1996................................................       4.84
March 1996...................................................       4.99
April 1996...................................................       5.28
May 1996.....................................................       5.43
June 1996....................................................       5.54
July 1996....................................................       5.65
August 1996..................................................       5.62
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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 September 1996 under part 4044 are 
contained in an amendment to part 4044 published elsewhere in today's 
Federal Register.

    Issued in Washington, DC, on this 12th day of August 1996.
Martin Slate,
Executive Director, Pension Benefit Guaranty Corporation.
[FR Doc. 96-20846 Filed 8-14-96; 8:45 am]
BILLING CODE 7708-01-P