Components of Net Periodic Benefit Cost

The Bank has a noncontributory defined benefit pension plan covering its full-time employees who had attained age 21 with at least one year of service as of April 1, 2003. The pension plan was frozen on April 1, 2003. All participants in the Plan are 100% vested. The pension plan’s assets are invested in investment funds and group annuity contracts currently managed by the Principal Financial Group and Allmerica Financial.

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 is 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 ten 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 ten 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, 2018 and 2017 includes the following components (in thousands):



	Three months ended March 31,
	Pension benefits					Other post- retirement benefits
	2018			2017		2018		2017
Service cost	$	—		—		29		26
Interest cost	274			307		197		218
Expected return on plan assets	(693		)	(638	)	—		—
Amortization of prior service cost	—			—		—		—
Amortization of net loss (gain)	199			230		(99	)	(169	)
Net periodic benefit (increase) cost	$	(220	)	(101	)	127		75

In its consolidated financial statements for the year ended December 31, 2017, the Company previously disclosed that it does not expect to contribute to the pension plan in 2018. As of March 31, 2018, no contributions have been made to the pension plan.

The net periodic benefit (increase) cost for pension benefits and other post-retirement benefits for the three months ended March 31, 2018 were calculated using the actual January 1, 2018 pension and other post-retirement benefits valuations.