[Federal Register: September 15, 2006 (Volume 71, Number 179)]

[Notices]               

[Page 54531-54532]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr15se06-84]                         



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PENSION BENEFIT GUARANTY CORPORATION



 

Required Interest Rate Assumption for Determining Variable-Rate 

Premium for Single-Employer Plans; Interest Assumptions for 

Multiemployer Plan Valuations Following Mass Withdrawal



AGENCY: Pension Benefit Guaranty Corporation.



ACTION: Notice of interest rates and assumptions.



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SUMMARY: This notice informs the public of the interest rates and 

assumptions to be used under certain Pension Benefit Guaranty 

Corporation regulations. These rates and assumptions are published 

elsewhere (or can be derived from rates published elsewhere), but are 

collected and published in this notice for the convenience of the 

public. Interest rates are also published on the PBGC's Web site 

(http://www.pbgc.gov).





DATES: The required interest rate for determining the variable-rate 

premium under part 4006 applies to premium payment years beginning in 

September 2006. The interest assumptions for performing multiemployer 

plan valuations following mass withdrawal under part 4281 apply to 

valuation dates occurring in October 2006.



FOR FURTHER INFORMATION CONTACT: Catherine B. Klion, Manager, 

Regulatory and Policy Division, Legislative and Regulatory Department, 

Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington, 

DC 20005, 202-326-4024. (TTY/TDD users may call the Federal relay 

service toll-free at 1-800-877-8339 and ask to be connected to 202-326-

4024.)



SUPPLEMENTARY INFORMATION:



Variable-Rate Premiums



    Section 4006(a)(3)(E)(iii)(II) of the Employee Retirement Income 

Security Act of 1974 (ERISA) and Sec.  4006.4(b)(1) of the PBGC's 

regulation on Premium Rates (29 CFR part 4006) prescribe use of an 

assumed interest rate (the ``required interest rate'') in determining a 

single-employer plan's variable-rate premium. Pursuant to the Pension 

Protection Act of 2006, for premium payment years beginning in 2006 or 

2007, the required interest rate is the



[[Page 54532]]



``applicable percentage'' (currently 85 percent) of the annual rate of 

interest determined by the Secretary of the Treasury on amounts 

invested conservatively in long-term investment grade corporate bonds 

for the month preceding the beginning of the plan year for which 

premiums are being paid (the ``premium payment year''). Thus, the 

required interest rate to be used in determining variable-rate premiums 

for premium payment years beginning in September 2006 is 5.19 percent 

(i.e., 85 percent of the 6.11 percent composite corporate bond rate for 

August 2006 as determined by the Treasury).

    The following table lists the required interest rates to be used in 

determining variable-rate premiums for premium payment years beginning 

between October 2005 and September 2006.



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                                                           The required

         For premium payment years beginning in:           interest rate

                                                                is:

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October 2005............................................            4.62

November 2005...........................................            4.83

December 2005...........................................            4.91

January 2006............................................            4.86

February 2006...........................................            4.80

March 2006..............................................            4.87

April 2006..............................................            5.01

May 2006................................................            5.25

June 2006...............................................            5.35

July 2006...............................................            5.36

August 2006.............................................            5.36

September 2006..........................................            5.19

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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 October 2006 under part 4044 are 

contained in an amendment to part 4044 published elsewhere in today's 

Federal Register. Tables showing the assumptions applicable to prior 

periods are codified in appendix B to 29 CFR part 4044.



    Issued in Washington, DC, on this 11th day of September 2006.

Vincent K. Snowbarger,

Interim Director, Pension Benefit Guaranty Corporation.

[FR Doc. E6-15313 Filed 9-14-06; 8:45 am]



BILLING CODE 7709-01-P