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Components of Net Periodic Benefit Cost (Notes)
 3 Months Ended
Mar. 31, 2015
Compensation and Retirement Disclosure [Abstract]  
Components of Net Periodic Benefit Cost
Components of Net Periodic Benefit Cost
The Bank has a noncontributory defined benefit pension plan (the “Plan”) covering its full-time employees who had attained age 21 with at least one year of service as of April 1, 2003, the date on which the Plan was frozen. All participants in the Plan are 100% vested. The Plan’s assets are invested in investment funds and group annuity contracts currently managed by the Principal Financial Group and Allmerica Financial. In an effort to lower and reduce the volatility of its future pension costs, the Company offered a lump sum pension distribution option to its vested terminated employees in the quarter ended June 30, 2014, and the Plan paid $4.3 million to those employees that elected to receive lump sum pension distributions and the Company realized an associated charge of $1.3 million. This charge was a pro rata share of the unrecognized losses recorded in other comprehensive income.
In addition to pension benefits, certain health care and life insurance benefits are currently made available to certain of the Bank’s retired employees. The costs of such benefits are accrued based on actuarial assumptions from the date of hire to the date the employee became fully eligible to receive the benefits. Effective January 1, 2003, eligibility for retiree health care benefits was frozen as to new entrants, and benefits were eliminated for employees with less than 10 years of service as of December 31, 2002. Effective January 1, 2007, eligibility for retiree life insurance benefits was frozen as to new entrants, and retiree life insurance benefits were eliminated for employees with less than 10 years of service as of December 31, 2006.
Net periodic benefit (increase) cost for pension benefits and other post-retirement benefits for the three months ended March 31, 2015 and 2014 included the following components (in thousands):
 

Three months ended March 31,
 

Pension
benefits

Other post-
retirement
benefits
 

2015

2014

2015

2014
Service cost

$
—

 
—

 
42

 
42

Interest cost

284

 
352

 
281

 
272

Expected return on plan assets

(633
)
 
(894
)
 
—

 
—

Amortization of prior service cost

—

 
—

 
—

 
(1
)
Amortization of the net loss

194

 
93

 
—

 
(51
)
Net periodic benefit (increase) cost

$
(155
)
 
(449
)
 
323

 
262


The net periodic benefit (increase) cost for pension benefits and other post-retirement benefits for the three months ended March 31, 2015 was calculated using the actual January 1, 2015 pension valuation and the other post-retirement benefits valuations.