General Electric (GE) has announced that it has transferred approximately $1.7 billion of its U.S. GE Pension Plan obligations by purchasing group annuity contracts from wholly owned subsidiaries of Athene Holding Ltd.
Approximately 70,000 of GE’s retirees and beneficiaries who receive monthly benefits of less than $360 will receive their monthly payments from one of Athene’s wholly owned subsidiaries. The purchase of the group annuity contracts will be funded directly by assets of the U.S. GE Pension Plan.
The transfer follows GE’s recent announcement to voluntarily pre-fund $2.5 billion of the plan’s estimated minimum Employee Retirement Income Security Act (ERISA) contribution requirements for 2021, 2022 and 2023.
“GE continues to appreciate the thousands of retirees who delivered for our customers, our shareholders and for each other. As we seek to balance GE’s ongoing obligations with the need to strengthen our balance sheet, we are pleased to enter into this arrangement with Athene,” says Kevin Cox, GE’s chief human resources (HR) officer.
GE said it engaged an independent fiduciary to select an annuity provider solely in the interest of plan participants and their beneficiaries. The company also said this transaction does not materially impact the plan’s funded status.
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