Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2018

The funded status and amounts recognized in the 2018 and 2017 consolidated balance sheets, as measured on December 31, 2018 and 2017, respectively, for the Retirement Account Plan and Postretirement Plan were as follows:



	Retirement Account Plan			Bank Mutual Pension			Postretirement Plan			Retirement Account Plan			Postretirement Plan
($ in Thousands)	2018			2018			2018			2017			2017
Change in Fair Value of Plan Assets
Fair value of plan assets at beginning of year	$	331,609		N/A			$	—		$	295,718		$	—
Fair value of Bank Mutual plan assets at February 1, 2018	N/A			59,445			—			N/A			N/A
Actual return on plan assets	(14,609		)	(1,665		)	—			41,490			—
Employer contributions	4,340			37,537			292			6,242			235
Gross benefits paid	(10,582		)	(15,513		)	(292		)	(11,841		)	(235		)
Bank Mutual plan assets transferred at December 31, 2018	79,805			(79,805		)	—			N/A			N/A
Fair value of plan assets at end of year ^(a)	$	390,564		$	—		$	—		$	331,609		$	—
Change in Benefit Obligation
Net benefit obligation at beginning of year	$	186,423		N/A			$	2,478		$	176,825		$	2,403
Net Bank Mutual benefit obligation at February 1, 2018	N/A			66,364			576			N/A			N/A
Service cost	7,540			—			—			6,955			—
Interest cost	6,727			2,398			108			7,121			101
Actuarial (gain) loss	(8,000		)	(1,701		)	(347		)	7,363			209
Gross benefits paid	(10,582		)	(2,644		)	(292		)	(11,841		)	(235		)
Lump sums paid	—			(12,868		)	—			—			—
Bank Mutual benefit obligations transferred at December 31, 2018	51,549			(51,549		)	—			N/A			N/A
Net benefit obligation at end of year ^(a)	$	233,658		$	—		$	2,523		$	186,423		$	2,478
Funded (unfunded) status	$	156,906		$	—		$	(2,523	)	$	145,186		$	(2,478	)
Noncurrent assets	156,906			—			—			145,186			—
Current liabilities	—			—			(219		)	—			(233		)
Noncurrent liabilities	—			—			(2,304		)	—			(2,245		)
Asset (Liability) Recognized in the Consolidated Balance Sheets	$	156,906		$	—		$	(2,523	)	$	145,186		$	(2,478	)

(a)

The fair value of the plan assets represented 167% and 178% of the net benefit obligation of the pension plan at December 31, 2018 and 2017, respectively.

AOCI Components

Amounts recognized in accumulated other comprehensive (income) loss, net of tax, as of December 31, 2018 and 2017 follow:



	Retirement Account Plan			Postretirement Plan			Retirement Account Plan			Postretirement Plan
($ in Thousands)	2018			2018			2017			2017
Prior service cost	$	(303	)	$	(588	)	$	(295	)	$	(531	)
Net actuarial loss	50,238			(17		)	24,926			205
Amount not yet recognized in net periodic benefit cost, but recognized in accumulated other comprehensive (income) loss	$	49,935		$	(605	)	$	24,631		$	(326	)

Changes in OCI

Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss) (“OCI”), net of tax, in 2018 and 2017 were as follows:



	Retirement Account Plan			Postretirement Plan			Retirement Account Plan			Postretirement Plan
($ in Thousands)	2018			2018			2017			2017
Net actuarial gain (loss)	$	(28,959	)	$	347		$	14,482		$	(209	)
Amortization of prior service cost	(73		)	(75		)	(73		)	(75		)
Amortization of actuarial loss (gain)	2,195			8			2,278			4
Adjustment for adoption of ASU 2018-02	(5,235		)	—			—			—
Income tax (expense) benefit	6,838			(71		)	(6,219		)	107
Total Recognized in OCI	$	(25,234	)	$	209		$	10,468		$	(173	)

Net period benefit cost for the pension plans

The components of net pension cost for the Retirement Account Plan for 2018, 2017, and 2016 were as follows:



	Retirement Account Plan			Retirement Account Plan			Retirement Account Plan
($ in Thousands)	2018			2017			2016
Service cost	$	7,540		$	6,955		$	6,780
Interest cost	9,125			7,121			7,121
Expected return on plan assets	(23,195		)	(19,646		)	(20,287		)
Amortization of prior service cost	(73		)	(73		)	(73		)
Amortization of actuarial loss (gain)	2,195			2,278			2,115
Recognized settlement loss (gain)	809			—			—
Total net periodic pension cost	$	(3,600	)	$	(3,365	)	$	(4,344	)

Net period benefit cost for postretirement plan

The components of net periodic benefit cost for the Postretirement Plan for 2018, 2017, and 2016 were as follows:



	Postretirement Plan			Postretirement Plan			Postretirement Plan
($ in Thousands)	2018			2017			2016
Interest cost	$	108		$	101		$	142
Amortization of prior service cost	(75		)	(75		)	—
Amortization of actuarial loss (gain)	8			4			—
Total net periodic benefit cost	$	41		$	30		$	142

Weighted Average Benefit Assumptions



	Retirement Account Plan		Postretirement Plan		Retirement Account Plan		Postretirement Plan
	2018		2018		2017		2017
Weighted average assumptions used to determine benefit obligations
Discount rate	4.30	%	4.30	%	3.70	%	3.70	%
Rate of increase in compensation levels	3.00	%	N/A		3.00	%	N/A
Weighted average assumptions used to determine net periodic benefit costs
Discount rate^(a)	3.77	%	3.77	%	4.10	%	4.10	%
Rate of increase in compensation levels	3.00	%	N/A		4.00	%	N/A
Expected long-term rate of return on plan assets^(b)	5.93	%	N/A		6.50	%	N/A

(a) Weighted average of the 2018 fiscal year discount rate assumption for the Retirement Account Plan was 3.70% and the Bank Mutual Pension Plan was 4.00% (b) Weighted average of the 2018 fiscal year expected return on asset assumption for the Retirement Account Plan was 6.00% and the Bank Mutual Pension Plan was 5.50%

Plan Asset Allocation Percentages

The asset allocation for the Retirement Account Plan as of the December 31, 2018 and 2017 measurement dates, respectively, by asset category were as follows:



Asset Category	2018		2017
Equity securities	49	%	60	%
Fixed-income securities	34	%	37	%
Group annuity contracts	12	%	—	%
Alternative securities	3	%	—	%
Other	2	%	3	%
Total	100	%	100	%

Pension Plan Investments

Based on these inputs, the following table summarizes the fair value of the Retirement Account Plan’s investments as of December 31, 2018 and 2017:



			Fair Value Measurements Using
($ in Thousands)	December 31, 2018		Level 1		Level 2		Level 3
Retirement Account Plan Investments
Money market account	$	7,159	$	7,159	$	—	$	—
Common /collective trust funds	138,020		138,020		—		—
Mutual funds	198,120		198,120		—		—
Group annuity contracts	47,265		—		—		47,265
Total Retirement Account Plan Investments	$	390,564	$	343,299	$	—	$	47,265
			Fair Value Measurements Using
($ in Thousands)	December 31, 2017		Level 1		Level 2		Level 3
Retirement Account Plan Investments
Money market account	$	9,577	$	9,577	$	—	$	—
Common /collective trust funds	133,210		133,210		—		—
Mutual funds	188,823		188,823		—		—
Total Retirement Account Plan Investments	$	331,610	$	331,610	$	—	$	—

Schedule of Changes in Fair Value of Plan Assets

The following presents a summary of the changes in the fair value of the Retirement Account Plan's Level 3 asset during the periods indicated. As noted above, the Corporation's Level 3 asset consists entirely of a group annuity contract issued by a life insurance company.



Fair Value Reconciliation of Level 3 Retirement Account Plan Investments	2018			2017
Fair value of group annuity contract at February 1, 2018 (date of Bank Mutual acquisition)	$	49,191		N/A
Actual return on plan assets	565			N/A
Benefits paid	(2,491		)	N/A
Fair value of group annuity contract at December 31, 2018	$	47,265		N/A

Expected Benefit Payments

The projected benefit payments were calculated using the same assumptions as those used to calculate the benefit obligations listed above. The projected benefit payments for the Retirement Account and Postretirement Plans at December 31, 2018, reflecting expected future services, were as follows:



($ in Thousands)	Retirement Account Plan		Postretirement Plan
Estimated future benefit payments
2019	$	18,774	$	224
2020	19,265		220
2021	19,161		216
2022	20,210		211
2023	20,086		206
2024-2028	89,992		925

One Percentage Point Change in Assumed Health Care Cost

A one percentage point change in the assumed health care cost trend rate would have the following effect:



	2018					2017
($ in Thousands)	100 bp Increase		100 bp Decrease			100 bp Increase		100 bp Decrease
Effect on total of service and interest cost	$	7	$	(6	)	$	7	$	(6	)
Effect on postretirement benefit obligation	$	164	$	(143	)	$	162	$	(140	)