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NOTE 7 - EMPLOYEE BENEFIT PLANS
The Company has a defined benefit pension plan covering substantially all full-time and eligible part-time associates and a Supplemental Executive Retirement Plan (“SERP”) and a Supplemental Executive Retirement Plan II (“SERP II”) covering its executive officers. The defined benefit plan was amended in December 2019 to remove plan eligibility for new associates hired after December 31, 2019. The SERP II was adopted by the Company’s Board on May 21, 2020 and covers certain executive officers that were not covered by the SERP.
The components of the net periodic benefit cost for the Company's qualified benefit pension plan were as follows:
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(Dollars in Thousands) |
2020 |
|
2019 |
|
2020 |
|
2019 |
Service Cost |
$ |
1,457 |
|
$ |
1,529 |
|
$ |
4,371 |
|
$ |
4,587 |
Interest Cost |
|
1,400 |
|
|
1,545 |
|
|
4,212 |
|
|
4,635 |
Expected Return on Plan Assets |
|
(2,748) |
|
|
(2,382) |
|
|
(8,245) |
|
|
(7,146) |
Prior Service Cost Amortization |
|
4 |
|
|
4 |
|
|
11 |
|
|
12 |
Net Loss Amortization |
|
974 |
|
|
965 |
|
|
2,959 |
|
|
2,895 |
Special Termination Charge |
|
- |
|
|
- |
|
|
61 |
|
|
- |
Net Periodic Benefit Cost |
$ |
1,087 |
|
$ |
1,661 |
|
$ |
3,369 |
|
$ |
4,983 |
|
|
|
|
|
|
|
|
|
|
|
|
Discount Rate |
|
3.53% |
|
|
4.43% |
|
|
3.53% |
|
|
4.43% |
Long-term Rate of Return on Assets |
|
7.00% |
|
|
7.25% |
|
|
7.00% |
|
|
7.25% |
The components of the net periodic benefit cost for the Company's SERP and SERP II were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(Dollars in Thousands) |
2020 |
|
2019 |
|
2020 |
|
2019 |
Service Cost |
$ |
10 |
|
$ |
- |
|
$ |
21 |
|
$ |
- |
Interest Cost |
$ |
83 |
|
$ |
87 |
|
$ |
238 |
|
$ |
261 |
Prior Service Cost Amortization |
|
109 |
|
|
- |
|
|
218 |
|
|
- |
Net Loss Amortization |
|
93 |
|
|
190 |
|
|
410 |
|
|
570 |
Net Periodic Benefit Cost |
$ |
295 |
|
$ |
277 |
|
$ |
887 |
|
$ |
831 |
|
|
|
|
|
|
|
|
|
|
|
|
Discount Rate |
|
3.16% |
|
|
4.23% |
|
|
3.16% |
|
|
4.23% |
The service cost component of net periodic benefit cost is reflected in compensation expense in the accompanying statements of income. The other components of net periodic cost are included in “other” within the noninterest expense category in the statements of income.
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