Pension and Other Postretirement Benefit Plans

9 Months Ended

Sep. 30, 2012

Pension and Other Postretirement Benefit Plans

Pension and Other Postretirement Benefit Plans [Text Block]

Note 13 — Pension and Other Postretirement Benefit Plans

The Company and certain of its subsidiaries provide pension, health care and life insurance defined benefits to eligible retired employees, spouses and other eligible dependents through various domestic and foreign plans. The effect of its foreign pension and other postretirement benefit plans is immaterial to the Company's results of operations, liquidity and financial position. Effective July 1, 2009, the Company froze its primary domestic defined benefit pension plans.

For the ninemonths ended September 30, 2012,the Company's unrecognized actuarial losses and prior service costs(reported in accumulated other comprehensive income) decreased by $66million pre-tax in the aggregate ($44 million after-tax) resulting in an increase in shareholders' equity. This decrease was primarily a result of net amortization of actuarial losses and prior service cost, results of the annual actuarial review completed during the second quarter of 2012, and settlement charges in the Company's non-qualified pension plan caused by lump sum payments that exceeded the expected annual interest cost.

Pension and Other Postretirement Benefits. Components of net pension and net other postretirement benefit costs were as follows:

	Pension Benefits								Other Postretirement Benefits
	Three Months Ended				Nine Months Ended				Three Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
(In millions)	2012		2011		2012		2011		2012		2011		2012		2011
Service cost	$	1	$	-	$	2	$	1	$	-	$	-	$	1	$	1
Interest cost		50		57		149		171		4		5		12		15
Expected long-term return on plan assets		(69)		(67)		(203)		(200)		-		-		-		-
Amortization of:
Net loss from past experience		15		10		45		29		-		-		-		-
Prior service cost		-		-		-		-		(3)		(4)		(9)		(12)
Settlement loss		-		-		6		-		-		-		-		-
Net cost	$	(3)	$	-	$	(1)	$	1	$	1	$	1	$	4	$	4

The Company funds its domestic qualified pension plans at least at the minimum amount required by the Pension Protection Act of 2006.For the nine months ended September 30, 2012, the Company contributed $226million to those plans, of which $90million was required and$136million was voluntary. For the remainder of 2012, the Company expects to make additional contributions of $24 million.