US public pensions could pay almost 90% of promised benefits if investment gains made in the first half of the fiscal year persist over the next six months, but risks are also climbing, according to S&P Global Inc.
Record-breaking stock returns and a solid bond market powered pensions to returns of about 8.5% from July through December, according to the rating company. Public pension funding levels would rise to 89% from 81% if performance in the second half of the fiscal year mirrors the first, S&P said in a report Tuesday.