XML 162 R47.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Employee Benefits (Tables)
 12 Months Ended
Dec. 31, 2019
Retirement Benefits [Abstract]  
Summary of Changes in Projected Benefit Obligation, Plan Assets, Funded Status, Amounts Recognized in Consolidated Balance Sheet and Accumulated Other Comprehensive Income (Loss)
The following table summarizes the changes in benefit obligations and plan assets for the years ended December 31, and the funded status and amounts recognized in the Consolidated Balance Sheet at December 31 for the retirement plans:
 
                                 
    Pension Plans        Postretirement
Welfare Plan		  
(Dollars in Millions)   2019        2018        2019        2018  
         
Change In Projected Benefit Obligation
(a)
                 
 
                      
Benefit obligation at beginning of measurement period
   $ 5,507        $ 5,720        $ 54        $ 68  
Service cost
     192          208          –          –  
Interest cost
     249          224          2          2  
Participants’ contributions
     –          –          7          8  
Actuarial loss (gain)
     1,100          (440 )         (4 )         (7 ) 
Lump sum settlements
     (56 )         (50 )         –          –  
Benefit payments
     (163 )         (155 )         (13 )         (18 ) 
Federal subsidy on benefits paid
     –          –          1          1  
Benefit obligation at end of measurement period
(b)
   $ 6,829        $ 5,507        $ 47        $ 54  
Change In Fair Value Of Plan Assets
(c)
                 
 
                      
Fair value at beginning of measurement period
   $ 4,936        $ 5,482        $ 81        $ 87  
Actual return on plan assets
     1,095          (365 )         6          –  
Employer contributions
     26          24          4          5  
Participants’ contributions
     –          –          6          7  
Lump sum settlements
     (56 )         (50 )         –          –  
Benefit payments
     (163 )         (155 )         (13 )         (18 ) 
Fair value at end of measurement period
   $ 5,838        $ 4,936        $ 84        $ 81  
Funded (Unfunded) Status
   $ (991 )       $ (571 )       $ 37        $ 27  
Components Of The Consolidated Balance Sheet
                 
 
                      
Noncurrent benefit asset
   $ –        $ –        $ 37        $ 27  
Current benefit liability
     (25 )         (23 )         –          –  
Noncurrent benefit liability
     (966 )         (548 )         –          –  
Recognized amount
   $ (991 )       $ (571 )       $ 37        $ 27  
Accumulated Other Comprehensive Income (Loss), Pretax
                 
 
                      
Net actuarial gain (loss)
   $ (2,271 )       $ (1,981 )       $ 68        $ 66  
Net prior service credit (cost)
     –          –          14          18  
Recognized amount
   $ (2,271 )       $ (1,981 )       $ 82        $ 84  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
The increase and the decrease in the projected benefit obligation for 2019 and 2018, respectively, were primarily due to discount rate changes.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(b)
At December 31, 2019 and 2018, the accumulated benefit obligation for all pension plans was $6.2 billion and $5.0 billion.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(c)
The increase and the decrease in the fair value of plan assets for 2019 and 2018, respectively, were primary due to market conditions.
 
 
 
Pension Plans with Benefit Obligations in Excess of Plan Assets
The following table provides information for pension plans with benefit obligations in excess of plan assets at December 31:
 
                 
(Dollars in Millions)      2019        2018  
Pension Plans with Projected Benefit Obligations in Excess of Plan Assets
                      
Projected benefit obligation
      $ 6,829        $ 5,507  
Fair value of plan assets
        5,838          4,936  
Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets
                      
Accumulated benefit obligation
      $ 553        $ 467  
Fair value of plan assets
        –          –  
 
 
 
Components of Net Periodic Benefit Cost and Other Amounts Recognized in Accumulated Other Comprehensive Income (Loss)
The following table sets forth the components of net periodic benefit cost and other amounts recognized in accumulated other comprehensive income (loss) for the years ended December 31 for the retirement plans:
 
                                                 
    Pension Plans        Postretirement Welfare Plan  
(Dollars in Millions)   2019        2018        2017        2019        2018        2017  
             
Components Of Net Periodic Benefit Cost
                            
 
                                 
Service cost
   $ 192        $ 208        $ 187  
    
 $ –        $ –        $ –  
Interest cost
     249          224          220          2          2          2  
Expected return on plan assets
     (383 )         (379 )         (284 )         (3 )         (3 )         (3 ) 
Prior service cost (credit) and transition obligation (asset) amortization
     –          –          (2 )         (3 )         (3 )         (3 ) 
Actuarial loss (gain) amortization
     98          146          127          (6 )         (6 )         (5 ) 
Net periodic benefit cost
   $ 156        $ 199        $ 248        $ (10 )       $ (10 )       $ (9 ) 
Other Changes In Plan Assets And Benefit Obligations
                            
 
                                 
Recognized In Other Comprehensive Income (Loss)
                            
 
                                 
Net actuarial gain (loss) arising during the year
   $ (388 )       $ (305 )       $ (48 )       $ 7        $ 3        $ 7  
Net actuarial loss (gain) amortized during the year
     98          146          127          (6 )         (6 )         (5 ) 
Net prior service cost (credit) and transition obligation (asset) amortized during the year
     –          –          (2 )         (3 )         (3 )         (3 ) 
Total recognized in other comprehensive income (loss)
   $ (290 )       $ (159 )       $ 77        $ (2 )       $
 
 (6 )       $
 
 
 (1 ) 
Total recognized in net periodic benefit cost and other comprehensive income (loss)
   $ (446 )       $ (358 )       $ (171 )       $ 8        $ 4        $ 8  
 
 
 
Weighted Average Assumptions to Determine Projected Benefit Obligations
The following table sets forth weighted
-
average assumptions used to determine the projected benefit obligations at December 31:
 
                                 
    Pension Plans        Postretirement
Welfare Plan		  
(Dollars in Millions)   2019      2018        2019      2018  
Discount rate
(a)
     3.40 %       4.45 %         2.80 %       4.05 % 
Cash balance interest crediting rate
     3.00        3.00          *        *  
Rate of compensation increase
(b)
     3.56        3.52          *        *  
Health care cost trend rate
(c)
                                     
Prior to age 65
                         6.25 %       6.50 % 
After age 65
  
 
 
 
   
 
 
 
        6.25 %       10.00 % 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
The discount rates were developed using a cash flow matching bond model with a modified duration for the qualified pension plan,
non-qualified
pension plan and postretirement welfare plan of 15.8, 12.3, and 6.1 years, respectively, for 2019, and 14.7, 11.5 and 5.9 years, respectively, for 2018.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(b)
Determined on an active liability-weighted basis.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(c)
The 2019
 and
 2018
pre-65
and
post-65
rates are
both
assumed to decrease gradually to 5.00 percent by 2025 and remain at this level thereafter.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
*
Not applicable
 
 
 
Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost
The following table sets forth weighted
-
average assumptions used to determine net periodic benefit cost for the years ended December 31:
 
                                                 
    Pension Plans        Postretirement Welfare Plan  
(Dollars in Millions)   2019      2018      2017        2019      2018      2017  
Discount rate
(a)
     4.45 %       3.84 %       4.27 %         4.05 %       3.34 %       3.57 % 
Cash balance interest crediting rate
     3.00        3.00        3.00          *        *        *  
Expected return on plan assets
(b)
     7.25        7.25        7.25          3.50        3.50        3.50  
Rate of compensation increase
(c)
     3.52        3.56        3.58          *        *        *  
Health care cost trend rate
(d)
                                                       
Prior to age 65
                                  6.50 %       6.75 %       7.00 % 
After age 65
  
 
 
 
   
 
 
 
   
 
 
 
        10.00        6.75        7.00  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
The discount rates were developed using a cash flow matching bond model with a modified duration for the qualified pension plan,
non-qualified
pension plan and postretirement welfare plan of 14.7, 11.5, and 5.9 years, respectively, for 2019, and 15.8, 12.3 and 6.1 years, respectively, for 2018.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(b)
With the help of an independent pension consultant, the Company considers several sources when developing its expected long-term rates of return on plan assets assumptions, including, but not limited to, past returns and estimates of future returns given the plans’ asset allocation, economic conditions, and peer group LTROR information. The Company determines its expected long-term rates of return reflecting current economic conditions and plan assets.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(c)
Determined on an active liability weighted basis.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(d)
The 2019, 2018 and 2017
pre-65
and
post-65
rates are
both
assumed to decrease gradually to 5.00 percent by 2025 and remain at that level thereafter.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
*
Not applicable
 
 
Summary of Plan Investment Assets Measured at Fair Value
The following table summarizes plan investment assets measured at fair value at December 31:
 
                                                                                 
    Qualified Pension Plan      Postretirement
Welfare Plan		  
    2019      2018      2019      2018  
(Dollars in Millions)   Level 1      Level 2      Level 3      Total      Level 1      Level 2      Level 3      Total      Level 1      Level 1  
Cash and cash equivalents
   $ 58      $ –      $ –      $ 58      $ 54      $ –      $ –      $ 54      $ 40      $ 42  
Debt securities
     727        1,073        –        1,800        631        904        –        1,535        –        –  
Corporate
s
tock
                                 
 
                                                      
Real estate equity securities
(a)
     –        –        –        –        109        –        –        109        –        –  
Mutual funds
                                 
 
                                                      
Debt securities
     –        304        –        304        –        295        –        295        –        –  
Emerging markets equity securities
     –        136        –        136        –        113        –        113        –        –  
Other
     –        –        3        3        –        –        3        3        –        –  
    $ 785      $ 1,513      $ 3        2,301      $ 794      $ 1,312      $ 3        2,109        40        42  
Plan investment assets not classified in fair value hierarchy
(b)
:
                                 
 
                                                      
Collective investment funds
                                 
 
                                                      
Domestic equity securities
                                1,328                                   1,183        27        24  
Mid-small
cap equity securities
(c)
                                323                                   340        –        –  
International equity securities
                                752                                   643        17        15  
Real
e
state securities
                                547                                   146        –        –  
Hedge funds
(d)
                                283                                   290        –        –  
Private equity funds
(e)
                                304                                   225        –        –  
Total plan investment assets at fair value
  
 
 
 
   
 
 
 
   
 
 
 
    $ 5,838     
 
 
 
   
 
 
 
   
 
 
 
    $ 4,936      $ 84      $ 81  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
At December 31, 2018, securities included $
56
million in domestic equities
 
and $
53
million in international equities.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(b)
These investments are valued based on net asset value per share as a practical expedient; fair values are provided to reconcile to total investment assets of the plans at fair value.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(c)
At December 31, 2019 and 2018, securities included $
323
 
million and $
340
million in domestic equities, respectively.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(d)
This category consists of several investment strategies diversified across several hedge fund managers.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(e)
This category consists of several investment strategies diversified across several private equity fund managers.
 
 
Summarizes the Changes for Qualified Pension Plan Assets Measured at Fair Value Using Significant Unobservable Inputs (Level 3)
The following table summarizes the changes in fair value for qualified pension plan investment assets measured at fair value using significant unobservable inputs (Level 3) for the years ended December 31:
 
                         
    2019        2018        2017  
(Dollars in Millions)   Other        Other        Other  
Balance at beginning of period
   $ 3        $ 2        $ 1  
Unrealized gains (losses) relating to assets still held at end of year
     –          –          –  
Purchases, sales, and settlements, net
     –          1          1  
Balance at end of period
   $ 3        $ 3        $ 2  
 
 
Expected Future Benefit Payments
The following benefit payments are expected to be paid from the retirement plans for the years ended December 31:
 
                         
(Dollars in Millions)   Pension
Plans		        Postretirement
Welfare Plan
(a)
        Medicare
Part D
Subsidy
Receipts		  
2020
   $ 233        $ 7        $ 1  
2021
     254          6          1  
2022
     267          6          1  
2023
     294          6          1  
2024
     306          5          1  
2025-2029
     1,811          19          2  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a)
Net of expected retiree contributions and before Medicare Part D subsidy.