Pension and Other Postretirement Benefit Plans

6 Months Ended

Jun. 30, 2012

Pension and Other Postretirement Benefit Plans

Pension and Other Postretirement Benefit Plans [Text Block]

Note 12 — Pension and Other Postretirement Benefit Plans

The Company and certain of its subsidiaries provide pension, health care and life insurance defined benefits to eligible retired employees, spouses and other eligible dependents through various domestic and foreign plans. The effect of its foreign pension and other postretirement benefit plans is immaterial to the Company's results of operations, liquidity and financial position. Effective July 1, 2009, the Company froze its primary domestic defined benefit pension plans.

For the sixmonths ended June 30, 2012,the Company's postretirement benefits liability decreased by $54million pre-tax ($36 million after-tax) resulting in an increase in shareholders' equity. This decrease was primarily a result of net amortization of actuarial losses and prior service cost, results of the annual actuarial review completed during the second quarter of 2012, and settlement charges in the Company's non-qualified pension plan caused by lump sum payments that exceeded the expected annual interest cost.

Pension and Other Postretirement Benefits. Components of net pension and net other postretirement benefit costs were as follows:

	Pension Benefits								Other Postretirement Benefits
	Three Months Ended				Six Months Ended				Three Months Ended				Six Months Ended
	June 30,				June 30,				June 30,				June 30,
(In millions)	2012		2011		2012		2011		2012		2011		2012		2011
Service cost	$	-	$	-	$	1	$	1	$	1	$	1	$	1	$	1
Interest cost		50		57		99		114		4		5		8		10
Expected long-term return on plan assets		(67)		(68)		(134)		(133)		-		(1)		-		(1)
Amortization of:
Net loss from past experience		15		10		30		19		-		-		-		-
Prior service cost		-		-		-		-		(3)		(4)		(6)		(8)
Settlement loss		-		-		6		-		-		-		-		-
Net cost	$	(2)	$	(1)	$	2	$	1	$	2	$	1	$	3	$	2

The Company funds its domestic qualified pension plans at least at the minimum amount required by the Pension Protection Act of 2006.For the six months ended June 30, 2012, the Company contributed $112million to those plans, of which $44million was required and$68million was voluntary. For the remainder of 2012, the Company expects to make additional contributions of $138 million.