NEW YORK (Reuters) - The difference between what U.S. corporate pensions owe versus their investments grew to their widest levels so far in 2016 in June as bond yields tumbled following Britain's vote to leave the European Union, a unit of BNY Mellon said on Thursday.
The funding gap among the biggest company-defined benefit plans fell by 2.1 percentage points to 78.1 percent in June. This compared with 87.8 percent a year earlier, BNY Mellon Fiduciary Solutions said.
"Asset growth of 1.5 percent was not enough for plan sponsors to outpace rising liabilities which increased by 4.0 percent in June after the EU Referendum vote shook global markets," the company said in a statement.
The corporate pensions' assets, tracked by BNY Mellon, were valued at $1.76 trillion last month, while their liabilities were worth $2.26 trillion.
The S&P 500 pension deficit was estimated to have risen by $61 billion last month to $495 billion, according to BNY Mellon.
As a result of the drop in bond yields, the corporate discount rate fell by 0.25 percentage point to 3.66 percent in June. This compared with 4.49 percent a year earlier.
While stock prices have recovered from a Brexit-driven market sell-off in late June, bond yields around the world have continued to reach historic lows, driving up the levels of pension liabilities, BNY Mellon said.
Year-to-date, domestic company pensions' assets have risen 6.5 percent, less than half the 13.85 percent growth in liabilities, it said.
(Reporting by Richard Leong; Editing by Bernadette Baum)