PENSION AND POSTRETIREMENT BENEFIT PLANS

The net periodic benefit cost/(credit) of defined benefit pension and postretirement benefit plans includes:



	Three Months Ended June 30,												Six Months Ended June 30,
	Pension Benefits						Other Benefits						Pension Benefits						Other Benefits
Dollars in Millions	2014			2013			2014			2013			2014			2013			2014			2013
Service cost – benefits earned during the year	$	10		$	9		$	1		$	2		$	20		$	19		$	2		$	3
Interest cost on projected benefit obligation	77			75			4			4			155			149			7			7
Expected return on plan assets	(133		)	(131		)	(7		)	(7		)	(264		)	(263		)	(14		)	(13		)
Amortization of prior service credits	(1		)	(1		)	(1		)	(1		)	(2		)	(2		)	(1		)	(1		)
Amortization of net actuarial loss	29			37			—			—			56			75			—			—
Curtailments and settlements	45			101			—			—			99			101			(3		)	—
Special termination benefits	—			—			—			—			13			—			—			—
Net periodic cost/(credit)	$	27		$	90		$	(3	)	$	(2	)	$	77		$	79		$	(9	)	$	(4	)

Pension settlement charges were recognized after determining that the annual lump sum payments will likely exceed the annual interest and service costs for certain pension plans, including the primary U.S. pension plan. The charges included the acceleration of a portion of unrecognized actuarial losses. The applicable pension benefit obligation and pension plan assets were remeasured as of June 30, 2014 resulting in a decrease to other assets and a corresponding increase in accumulated other comprehensive loss of $299 million. The changes resulted from a lower weighted average discount rate assumed in remeasuring the pension benefit obligations (4.0% at June 30, 2014 and 4.6% at December 31, 2013) partially offset by higher actual return on plan assets than expected. Contributions to the pension plans are expected to approximate $120 million during 2014, of which $83 million were incurred in the six months ended June 30, 2014.

The expense attributed to defined contribution plans in the U.S. was $46 million and $43 million for the three months ended June 30, 2014 and 2013, respectively, and $96 million and $90 million for the six months ended June 30, 2014, and 2013, respectively.