Consulting and outsourcing services provider Accenture Plc said on Friday it would transfer $1.6 billion in pension obligations to insurers American International Group Inc and MassMutual.
The transfer includes about $600 million in lump-sum payments to about 7,000 current and former U.S. employees of Accenture and $1 billion in purchases of annuities from insurance companies.
U.S. insurers are buying corporate pension plans at a record clip as rising interest rates and all-time high stock-market values give companies the perfect excuse to offload them.
Calculating they can make more money from selling companies an annuity to cover the cost of the pension plans and then invest the proceeds in bonds and other securities, insurers are competing to persuade corporate America to sell them their pension risk.
Pension transfers totaling $13.7 billion were finalized last year, up 1 percent from 2015, according to LIMRA, an industry trade group. The figure is the second highest annual total ever recorded, LIMRA said.
The average corporate pension fund was 83 percent funded in May, according to Mercer Investment Consulting.
In May, Sears Holdings Corp, the struggling retailer, transferred $515 million in pension obligations to Metlife Inc, a deal covering 51,000 retirees, the company said.