The funded status of the typical U.S. corporate pension plan in September increased 1.8 percentage points to 75 percent as stock markets continued to rally, according to BNY Mellon. In addition, BNY Mellon said pension plans benefited from a decline in liabilities as interest rates rose.

This was the first time since February that the funded status of these plans improved for two months in a row, according to the BNY Mellon Pension Summary Report for September 2012.   Assets for the typical plan increased 1.7 percent as stock markets in the U.S. and around the world continued to rally, the report said.

Liabilities for the typical plan declined 0.7 percent as the Aa corporate discount rate rose six basis points to 3.78 percent, BNY Mellon said. Plan liabilities are calculated using the yields of long-term investment grade bonds.  Higher yields on these bonds result in lower liabilities.

"Pension plans have been benefiting all year from rising equity markets but have had their gains offset by persistent low interest rates that have sent liabilities higher," said Jeffrey B. Saef, managing director, BNY Mellon Asset Management, and head of the BNY Mellon Investment Strategy and Solutions Group.  "We've now had two months in a row of slightly rising interest rates, which have brought liabilities lower.  The result has been the first two-month streak of improved funded status since February 2012."

Year to date, the funded status of the typical U.S. corporate plan is down 0.3 percentage points, BNY Mellon said.