Retirement Benefits

The Company maintains qualified and non-qualified defined benefit pension plans for its U.S. and non-U.S. eligible employees. The Company’s policy for funding its tax qualified defined benefit retirement plans is to contribute amounts at least sufficient to meet the funding requirements set forth by U.S. law and the laws of the non-U.S. jurisdictions in which the Company offers defined benefit plans.

The target asset allocation for the U.S. Plan is 58% equities and equity alternatives and 42% fixed income. As of March 31, 2014, the actual allocation for the U.S. Plan was 62% equities and equity alternatives and 38% fixed income. The target asset allocation for the U.K. Plans, which comprises approximately 82% of non-U.S. Plan assets, is 50% equities and equity alternatives and 50% fixed income. As of March 31, 2014, the actual allocation for the U.K. Plan was 48% equities and equity alternatives and 52% fixed income. The assets of the Company's defined benefit plans are diversified and are managed in accordance with applicable laws and with the goal of maximizing the plans' real return within acceptable risk parameters. The Company generally uses threshold-based portfolio re-balancing to ensure the actual portfolio remains consistent with target asset allocation ranges.

After completion of a consultation period with affected colleagues, in January 2014, the Company amended its U.K. defined benefit pension plans to close those plans to future benefit accruals effective August 1, 2014 and will replace those plans, along with its existing defined contribution plans, with a new, comprehensive defined contribution arrangement. This change resulted in a curtailment of the U.K. defined benefit plans, and as required under GAAP, the Company re-measured the defined benefit plans’ assets and liabilities at the amendment date, based on assumptions and market conditions at that date. As a result of the re-measurement, the projected benefit obligation ("PBO") increased by approximately $147 million and the funded status decreased by approximately $137 million. The change in the PBO and in the funded status relates primarily to a decrease in the discount rate at the re-measurement date. The net periodic benefit costs recognized in 2014 are the weighted average resulting from the December 31, 2013 measurement and the January 2014 re-measurement. The Company recognized a curtailment gain of $65 million in the first quarter of 2014, primarily resulting from the recognition of the remaining unamortized prior service credit related to a plan amendment made in December 2012. This gain was mostly offset by the cost of a transition benefit for certain employees most impacted by the amendment, which is not part of net periodic pension cost.

The components of the net periodic benefit cost for defined benefit and other post-retirement plans are as follows:



Combined U.S. and significant non-U.S. Plans	Pension						Postretirement
For the Three Months Ended March 31,	Benefits						Benefits
(In millions of dollars)	2014			2013			2014		2013
Service cost	$	61		$	64		$	1	$	2
Interest cost	161			145			3		3
Expected return on plan assets	(248		)	(228		)	—		—
Amortization of prior service credit	(3		)	(5		)	—		—
Recognized actuarial loss	51			78			—		—
Net periodic benefit cost	$	22		$	54		$	4	$	5
Curtailment (credit)	(65		)	—			—		—
Total cost (credit)	$	(43	)	$	54		$	4	$	5



U.S. Plans only	Pension						Postretirement
For the Three Months Ended March 31,	Benefits						Benefits
(In millions of dollars)	2014			2013			2014		2013
Service cost	$	22		$	27		$	—	$	1
Interest cost	63			57			2		2
Expected return on plan assets	(86		)	(81		)	—		—
Amortization of prior service credit	(2		)	(4		)	—		—
Recognized actuarial loss (gain)	26			51			—		—
Net periodic benefit cost (credit)	$	23		$	50		$	2	$	3



Significant non-U.S. Plans only	Pension						Postretirement
For the Three Months Ended March 31,	Benefits						Benefits
(In millions of dollars)	2014			2013			2014		2013
Service cost	$	39		$	37		$	1	$	1
Interest cost	98			88			1		1
Expected return on plan assets	(162		)	(147		)	—		—
Amortization of prior service cost	(1		)	(1		)	—		—
Recognized actuarial loss	25			27			—		—
Net periodic benefit cost	$	(1	)	$	4		$	2	$	2
Curtailment (credit)	(65		)	—			—		—
Total cost (credit)	$	(66	)	$	4		$	2	$	2

The weighted average actuarial assumptions utilized to calculate the net periodic benefit costs for the U.S. and significant non-U.S. defined benefit plans are as follows:



Combined U.S. and significant non-U.S. Plans	Pension Benefits				Postretirement Benefits
March 31,	2014		2013		2014		2013
Weighted average assumptions:
Expected return on plan assets	7.53	%	7.66	%	—	%	—	%
Discount rate	4.74	%	4.38	%	5.03	%	4.32	%
Rate of compensation increase	2.64	%	2.43	%	—	%	—	%

The Company made approximately $54 million of contributions to its U.S. and non-U.S. defined benefit plans in the first three months of 2014. The Company expects to contribute approximately $130 million to its non-qualified U.S. pension and non-U.S. pension plans during the remainder of 2014.