Quarterly report pursuant to Section 13 or 15(d)

Pension and Postretirement plans

v2.3.0.15
Pension and Postretirement plans
 9 Months Ended
Sep. 30, 2011
Compensation and Retirement Disclosure [Abstract]  
Pension and Postretirement plans
NOTE 15 – Pension and Postretirement Plans

The Corporation sponsors noncontributory trusteed pension plans that cover substantially all officers and employees, a number of noncontributory nonqualified pension plans, and postretirement health and life plans. Additional information on these plans is presented in Note 19 – Employee Benefit Plans to the Consolidated Financial Statements of the Corporation's 2010 Annual Report on Form 10-K.

As a result of the Merrill Lynch acquisition, the Corporation assumed the obligations related to the plans of Merrill Lynch. These plans include a terminated U.S. pension plan, non-U.S. pension plans, nonqualified pension plans and postretirement plans. The non-U.S. pension plans vary based on the country and local practices. In 1988, Merrill Lynch purchased a group annuity contract that guarantees the payment of benefits vested under the terminated U.S. pension plan. The Corporation, under a supplemental agreement, may be responsible for, or benefit from actual experience and investment performance of the annuity assets. The Corporation made no contributions under this agreement in the nine months ended September 30, 2011 and 2010. Contributions may be required in the future under this agreement.

Net periodic benefit cost of the Corporation’s plans for the three and nine months ended September 30, 2011 and 2010 included the following components.
 
Three Months Ended September 30, 2011
(Dollars in millions)
Qualified Pension
Plans
 
Non-U.S. Pension
Plans
 
Nonqualified and
Other Pension
Plans (1)
 
Postretirement
Health and Life
Plans
Components of net periodic benefit cost
 
 
 
 
 
 
 
Service cost
$
105

 
$
12

 
$
1

 
$
4

Interest cost
187

 
27

 
39

 
20

Expected return on plan assets
(323
)
 
(31
)
 
(36
)
 
(3
)
Amortization of transition obligation
—

 
—

 
—

 
8

Amortization of prior service cost (credits)
5

 
—

 
(2
)
 
1

Amortization of net actuarial loss (gain)
96

 
—

 
4

 
(4
)
Net periodic benefit cost
$
70

 
$
8

 
$
6

 
$
26

 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2011
Components of net periodic benefit cost
 
 
 
 
 
 
 
Service cost
$
317

 
$
33

 
$
2

 
$
11

Interest cost
560

 
75

 
115

 
60

Expected return on plan assets
(972
)
 
(87
)
 
(106
)
 
(7
)
Amortization of transition obligation
—

 
—

 
—

 
24

Amortization of prior service cost (credits)
15

 
—

 
(6
)
 
3

Amortization of net actuarial loss (gain)
290

 
—

 
12

 
(13
)
Recognized termination and settlement benefit cost
—

 
—

 
3

 
—

Net periodic benefit cost
$
210

 
$
21

 
$
20

 
$
78

 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2010
Components of net periodic benefit cost
 
 
 
 
 
 
 
Service cost
$
99

 
$
7

 
$
1

 
$
4

Interest cost
187

 
21

 
41

 
23

Expected return on plan assets
(316
)
 
(23
)
 
(34
)
 
(2
)
Amortization of transition obligation
—

 
—

 
—

 
8

Amortization of prior service cost (credits)
7

 
—

 
(2
)
 
2

Amortization of net actuarial loss (gain)
91

 
—

 
2

 
(13
)
Recognized termination and settlement benefit cost
—

 
—

 
1

 
—

Net periodic benefit cost
$
68

 
$
5

 
$
9

 
$
22

 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2010
Components of net periodic benefit cost
 
 
 
 
 
 
 
Service cost
$
298

 
$
21

 
$
3

 
$
11

Interest cost
561

 
61

 
126

 
68

Expected return on plan assets
(947
)
 
(68
)
 
(104
)
 
(7
)
Amortization of transition obligation
—

 
—

 
—

 
24

Amortization of prior service cost (credits)
21

 
—

 
(6
)
 
5

Amortization of net actuarial loss (gain)
272

 
—

 
5

 
(38
)
Recognized termination and settlement benefit cost
—

 
—

 
15

 
—

Net periodic benefit cost
$
205

 
$
14

 
$
39

 
$
63

(1) 
Includes nonqualified pension plans and the terminated Merrill Lynch U.S. pension plan.

In 2011, the Corporation expects to contribute approximately $101 million to its non-U.S. pension plans, $103 million to its nonqualified and other pension plans and $121 million to its postretirement health and life plans. For the nine months ended September 30, 2011, the Corporation contributed $91 million, $85 million and $91 million, respectively, to these plans. The Corporation does not expect to be required to contribute to its qualified pension plans during 2011.