ASSOCIATE BENEFIT PLANS

3 Months Ended

Mar. 31, 2020

12. ASSOCIATE BENEFIT PLANS

Postretirement Medical Benefits

We share certain costs of providing health and life insurance benefits to eligible retired Associates (employees) and their eligible dependents. Previously, all Associates were eligible for these benefits if they reached normal retirement age while working for us. Effective March 31, 2014, we changed the eligibility of this plan to include only those Associates who have achieved ten years of service with us as of March 31, 2014. As of December 31, 2014, we began to use the mortality table issued by the Office of the Actuary of the U.S. Bureau of Census in our calculation.

We account for our obligations under the provisions of ASC 715, Compensation - Retirement Benefits (ASC 715). ASC 715 requires that we recognize the costs of these benefits over an Associate’s active working career. Amortization of unrecognized net gains or losses resulting from experience different from that assumed and from changes in assumptions is included as a component of net periodic benefit cost over the remaining service period of active employees to the extent that such gains and losses exceed 10% of the accumulated postretirement benefit obligation, as of the beginning of the year. We recognize our service cost in Salaries, benefits and other compensation and the other components of net periodic benefit cost in Other operating expenses in our unaudited Consolidated Statements of Income.

The following table presents the components of net periodic benefit cost related to our postretirement medical benefits plan.


	Three months ended March 31,
(Dollars in thousands)	2020		2019
Service cost	$	15	$	13
Interest cost	17		19
Prior service cost amortization	(19)		(19)
Net gain recognition	(9)		(15)
Net periodic cost (benefit)	$	4	$	(2)

Alliance Associate Pension Plan

During the fourth quarter of 2015, we completed the acquisition of Alliance. At the time of the acquisition, we assumed the Alliance pension plan offered to its current Associates.

The following table presents the components of net periodic benefit cost related to the Alliance Associate Pension Plan.


	Three months ended March 31,
(Dollars in thousands)	2020		2019
Service cost	$	10	$	10
Interest cost	63		69
Expected return on plan assets	(117)		(147)
Prior service cost amortization	—		—
Net gain recognition	—		—
Net periodic benefit	$	(44)	$	(68)

During the fourth quarter of 2018, the Company notified the Alliance pension plan participants, the Internal Revenue Service (IRS), and the Pension Benefit Guaranty Corporation (PBGC) of its intention to terminate the plan. During the first quarter of 2020, the Company received IRS and PBGC approval, and has begun the next steps to complete the pension plan termination.

Beneficial Associate Pension and other postretirement benefits plans

On March 1, 2019, we closed our acquisition of Beneficial. At the time of the acquisition, we assumed the pension plan covering certain eligible Beneficial Associates. The plan was frozen in 2008.

The following table presents the components of net periodic benefit cost related to the Beneficial pension benefits and other postretirement benefit plans.


	Three months ended March 31, 2020		One month ended March 31, 2019		Three months ended March 31, 2020		One month ended March 31, 2019
(Dollars in thousands)	Pension Benefits						Other Postretirement Benefits
Service cost	$	—	$	—	$	28	$	8
Interest cost	715		286		138		59
Expected return on plan assets	(1,594)		(481)		—		—
Prior service cost amortization	—		—		—		—
Net loss (gain) recognition	1		—		(15)		—
Net periodic (benefit) cost	$	(878)	$	(195)	$	151	$	67