Defined Pension Plans

9 Months Ended

Sep. 30, 2019

Retirement Benefits [Abstract]

Defined Pension Plans

Note 9 – Defined Pension Plans

The Company has a noncontributory defined-benefit pension plan, which covers most of its employees. Effective December 31, 2016, the plan was closed to all new participants. The Company accrues and makes contributions designed to fund normal service costs on a current basis using the projected unit credit with service proration method to amortize prior service costs arising from improvements in pension benefits and qualifying service prior to the establishment of the plan over a period of approximately 30 years. Disclosure information is based on a measurement date of December 31 of the corresponding year. The following table represents the components of the net periodic pension costs:

(In thousands)	Estimated 2019		Actual 2018
Service cost – benefits earned during the year	$	3,708	$	4,017
Interest cost on projected benefit obligations		4,083		3,703
Expected return on plan assets		(4,754)		(5,202)
Net amortization and deferral		1,634		1,522
Net periodic pension cost	$	4,671	$	4,040

Pension costs recorded to expense were $1,178,000 and $1,049,000 for the three-month periods ended September 30, 2019 and 2018, respectively, and totaled $3,543,000 and $3,147,000 for the nine-month periods ended September 30, 2019 and 2018, respectively. Pension costs increased in 2019 primarily due to a decrease in the discount rate. The Company made no contribution to the plan during the nine-month period ended September 30, 2019 and is evaluating the amount of additional contributions, if any, in the remainder of 2019.Net periodic pension cost is presented within personnel expense in the Consolidated Statements of Income.

In addition to the above funded benefit plan, the Company has an unfunded supplemental executive retirement plan which covers key executives of the Company. This is a noncontributory plan in which the Company and its subsidiaries make accruals designed to fund normal service costs on a current basis using the same method and criteria as its defined benefit plan. The following table represents the components of the net periodic pension costs for 2018 and an estimate for 2019:

(In thousands)	Estimated 2019		Actual 2018
Service cost – benefits earned during the year	$	97	$	92
Interest cost on projected benefit obligation		408		348
Net amortization		276		581
Net periodic pension cost	$	781	$	1,021

Pension costs recorded to expense were $195,000 and $255,000 for the three-month periods ended September 30, 2019 and 2018, respectively, and were $586,000 and $766,000 for the nine-month periods ended September 30, 2019 and 2018, respectively.