A fifth consecutive month of rallying equities helped to drive the funded status of the typical U.S. corporate pension plan 2.1 percentage points higher to 76.2 percent in February, according to BNY Mellon Asset Management.  The pension plans also benefited from a slight rise in interest rates, which resulted in lower liabilities, according to the BNY Mellon Pension Summary Report for February 2012.

The funded status of the typical corporate plan has now increased 3.8 percentage points this year.

Assets for the typical plan in February rose 2.7 percent, as liabilities decreased 0.2 percent, BNY Mellon said.  The decline in liabilities was due to a 3 basis point increase in the Aa corporate discount rate to 4.33 percent, according to the report.

Plan liabilities are calculated using the yields of long-term investment grade corporate bonds.   Higher yields on these bonds result in lower liabilities.

"The equity markets have provided some relief to corporate pension plans for the last five months and we now are at our best funding levels since August 2011," said Jeffrey B. Saef, managing director, BNY Mellon Asset Management, and head of the BNY Mellon Investment Strategy & Solutions Group (a division of The Bank of New York Mellon).  "Corporate plans will need the rally in stocks to continue, a bump in interest rates, or a combination of these drivers to further close their funding gaps."