Note 19: Multiemployer Defined Benefit Plan

In connection with the acquisition of Kentucky Federal Savings and Loan Association, Cincinnati Federal is now part of a multiple-employer pension plan that is considered a multiemployer plan for accounting purposes. The Pentegra Defined Benefit Plan for Financial Institutions (Pentegra DB Plan) is a tax-qualified defined benefit plan. The Pentegra DB Plan’s Employer Identification Number is 13-5645888 and the Plan Number is 333. The Pentegra DB Plan operates as a multiemployer plan for accounting purposes and as a multiple –employer plan under the Employee Retirement Income Security Act of 1974 and the IRC. There are no collective bargaining agreements in place that require contributions to the Pentegra DB Plan.

The Pentegra DB Plan is a single plan under Internal Revenue Code Section 413(c) and, as a result, all of the assets stand behind all of the liabilities. Accordingly, under the Pentegra DB Plan contributions made by a participating employer may be used to provide benefits of other participating employers. If Cincinnati Federal chooses to stop participating in this plan, it may be required to pay an amount based on the underfunded status of the plan, referred to as the withdrawal liability. Effective June 30, 2016, participation in the plan was frozen.

The funded status (market value divided by funding target) of the plan at June 30, 2019 and 2018 was 85.94% and 88.12%, respectively.

Total contributions made to the Pentegra DB Plan, as reported on Form 5500, equal $164,570,408 and $367,119,418 for the plan years ended June 30, 2018 and June 30, 2017. Cincinnati Federal’s contribution to the Pentegra DB Plan for the fiscal year ending December 31, 2018 are not more than 5% of the total contributions to the Pentegra DB Plan for the plan year ended June 30, 2018.

Accounting Standards Update 2011‑09 requires the use of the most recently available annual return (Form 5500) to determine if an employer’s contributions represent more than 5% of total contributions to the Pentegra DB Plan. The 2017 Form 5500 is the most recently available annual report. The Schedule SB contains the total contributions to the Pentegra DB Plan for the year ending June 30, 2018. Cincinnati Federal’s contributions to the plan were $105,511 and $145,930 for the years ending December 31, 2019 and 2018, respectively.

Employer

Company

FIP/RP Status

Plan

Identification

Contributions

Pending/

Expiration of Collective

Name

Number

2019

2018

Implemented

Bargaining Agreement

Pentegra Defined Benefit Plan for Financial Institutions

13-5645888/333

105,511

145,930

Not applicable