March 15, 2002 Interest Rate Update
The immediate interest rate for valuing lump sum payments for the month of April 2002 is 4.25%. The deferred interest rate I1 is 4.00%, I2 is 4.00%, and I3 is 4.00%. (The immediate interest rate for March 2002 was 4.50% for lump sum payments; the deferred interest rate I1 was 4.00%, I2 was 4.00%, and I3 was 4.00%.)
PBGC is unable to provide the required interest rate for determining the variable rate premium amount for premium payment years commencing in March 2002. The Treasury Department has suspended issuance of 30-year Treasury securities and, effective February 18, 2002, ceased supplying the Federal Reserve board with an estimate of the annual yield on 30-year Treasury securities for publication in Statistical Release H.15. As a result of these changes, the PBGC is consulting with the Treasury Department on how best to determine the required interest rate. As soon as the PBGC determines the required interest rate to be used, it will inform the public of the rate. (This will be well before the variable rate premium for premium payment years beginning in March 2002 is due.)
The March 2002 required interest rate for the variable rate premium has been determined. Please refer to the Variable Rate Premium page for this rate.
The select and ultimate interest rates for valuing annuity benefits in single-employer plans and multiemployer plans for the month of April 2002 are 5.50% for the first 25 years following the date of plan termination and 4.25% thereafter, respectively. (The select interest rate for March 2002 was 5.60% for the first 25 years and the ultimate rate was 4.25%.)
The interest rate that PBGC will charge on employer liability, unpaid contributions, and unpaid premiums, for the calendar quarter beginning January 1, and ending March 31, 2002, is 6%. (The interest rate for October 1 to December 31, 2001 was 7%.)
The interest rate to be charged by multiemployer pension plans on withdrawal liability payments that are overdue or in default, or that is to be credited by such plans on overpayments of withdrawal liability during the calendar quarter beginning January 1, and ending March 31, 2002, is 4.75%. (The interest rate for October 1 to December 31, 2001 was 6.50%.)
This page was updated on March 31, 2002.