Bank of America 2002 Annual Report Download - page 103

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BANK OF AMERICA 2002 101
Qualified Nonqualified Postretirement
Pension Plan Pension Plans Health and Life Plans
(Dollars in millions)
2002 2001 2002 2001 2002 2001
Change in fair value of plan assets
(Primarily listed stocks, fixed income and real estate)
Fair value at January 1 $ 8,264 $8,652 $– $– $194 $ 208
Actual return on plan assets (722) (154) ––(13) (14)
Company contributions 700 500 39 98 84 69
Plan participant contributions ––––49 41
Acquisition/transfer –16 ––––
Benefits paid (724) (750) (39) (98) (133) (110)
Fair value at December 31 $ 7,518 $8,264 $– $– $181 $194
Change in projected benefit obligation
Projected benefit obligation at January 1 $ 7,606 $ 8,011 $ 529 $ 534 $ 944 $ 840
Service cost 199 202 27 22 11 11
Interest cost 540 560 44 40 67 64
Plan participant contributions ––––49 41
Plan amendments 6–(4) 2829
Actuarial loss (gain) –(434) 108 9112 69
Acquisition/transfer –17 –20 ––
Effect of curtailments ––(15) –––
Effect of special termination benefits ––2–––
Benefits paid (724) (750) (39) (98) (133) (110)
Projected benefit obligation at December 31 $ 7,627 $7,606 $ 652 $ 529 $1,058 $ 944
Funded status at December 31
Accumulated Benefit Obligation (ABO) $ 7,264 $7,263 $573 $ 459 $ N/A $ N/A
Overfunded (unfunded) status of ABO 254 1,001 (573) (459) N/A N/A
Provision for future salaries 363 343 79 70 N/A N/A
Projected Benefit Obligation (PBO) 7,627 7,606 652 529 1,058 944
Overfunded (unfunded) status of PBO $ (109) $ 658 $ (652) $ (529) $ (877) $ (750)
Unrecognized net actuarial loss 2,422 954 168 86 147 45
Unrecognized transition obligation ––11323 355
Unrecognized prior service cost 419 468 21 61 46 44
Prepaid (accrued) benefit cost $2,732 $2,080 $ (462) $ (381) $ (361) $ (306)
Weighted average assumptions at December 31
Discount rate 6.75% 7.25% 6.75% 7.25% 6.75% 7.25%
Expected return on plan assets 8.50 10.00 N/A N/A 8.50 10.00
Rate of compensation increase 4.00 4.00 4.00 4.00 N/A N/A
Net periodic pension benefit cost for the years ended December 31, 2002, 2001 and 2000, included the following components:
Qualified Pension Plan Nonqualified Pension Plans
(Dollars in millions)
2002 2001 2000 2002 2001 2000
Components of net periodic pension benefit cost (income)
Service cost $ 199 $ 202 $ 153 $27 $22 $10
Interest cost 540 560 519 44 40 39
Expected return on plan assets (746) (876) (813) –––
Amortization of transition obligation (asset) –(2) (4) ––1
Amortization of prior service cost 55 54 38 10 11 10
Recognized net actuarial loss –––11 79
Recognized loss (gain) due to settlements and curtailments –– (11) 26 6–
Net periodic pension benefit cost (income) $48 $ (62) $ (118) $ 118 $86 $69
The following table summarizes the changes in fair value of
plan assets, changes in projected benefit obligations (PBO), the
funded status of the PBO and the weighted average assumptions for
the pension plans and postretirement plans for the years ended
December 31, 2002 and 2001. Prepaid and accrued benefit costs are
reflected in other assets and other liabilities, respectively, in the
Consolidated Balance Sheet. For the Pension Plan, the asset valua-
tion method recognizes 60 percent of the market gains or losses in
the first year, with the remaining 40 percent spread equally over the
next four years. For both the Pension Plan and the Postretirement
Health and Life Plans, the expected long-term return on plan assets
will be 8.50% for 2003.