Employee Benefit Plans

6 Months Ended

Jun. 30, 2016

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

NOTE 15 - EMPLOYEE BENEFIT PLANS

RETIREMENT PLAN

Old National maintains a funded noncontributory defined benefit plan (the “Retirement Plan”) that was frozen as of December 31, 2005. Retirement benefits are based on years of service and compensation during the highest paid five years of employment. The freezing of the plan provides that future salary increases will not be considered. Old National’s policy is to contribute at least the minimum funding requirement determined by the plan’s actuary. Old National does not expect to contribute cash payments to the Retirement Plan in 2016.

Old National also maintains an unfunded pension restoration plan (the “Restoration Plan”) which provides benefits for eligible employees that are in excess of the limits under Section 415 of the Internal Revenue Code of 1986, as amended, that apply to the Retirement Plan. The Restoration Plan is designed to comply with the requirements of ERISA. The entire cost of the plan, which was also frozen as of December 31, 2005, is supported by contributions from the Company.

Old National contributed $19 thousand to cover benefit payments from the Restoration Plan during the six months ended June 30, 2016. Old National expects to contribute an additional $19 thousand to cover benefit payments from the Restoration Plan during the remainder of 2016.

The net periodic benefit cost and its components were as follows for the three and six months ended June 30:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(dollars in thousands)	2016			2015			2016			2015
Interest cost	$	440		$	415		$	880		$	830
Expected return on plan assets		(442	)		(511	)		(885	)		(1,023	)
Recognized actuarial loss		494			531			988			1,062
Settlement loss		235			196			441			402
Net periodic benefit cost	$	727		$	631		$	1,424		$	1,271

In March 2016, we sent to participants and beneficiaries a Notice of Intent to Terminate the Employee Retirement Plan effective May 15, 2016. The complete distribution of the trust fund during the fourth quarter of 2016 is expected to result in a pre-tax charge of $11 million to $13 million and relieve Old National of all future obligations and expense.