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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 Job Creation and Worker Assistance Act of 2002 changed the Required Interest Rate for determining the variable rate premium. The Required Interest Rate is equal to the applicable percentage of the annual yield on 30-year Treasury securities for the month preceding the month in which a plan year begins. The new law changed the applicable percentage from 85 percent to 100 percent for plan years beginning after December 31, 2001, and before January 1, 2004. The rates for January 2002 and February 2002 have been recalculated using the new applicable percentage.
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 April 1, and ending June 30, 2002, is 6%. (The interest rate for January 1 to March 31, 2002 was 6%.)
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 April 1, and ending June 30, 2002, is 4.75%. (The interest rate for January 1 to March 31, 2002 was 4.75%.)
This page was updated on April 15, 2002.
