MCBF » Topics » Note 15 - Retirement Plans

This excerpt taken from the MCBF 10-K filed Mar 26, 2007.

Note 15 - Retirement Plans

 

 

 

The Corporation is part of a non-contributory, multi-employer defined benefit pension plan covering substantially all employees. Effective April 1, 2004 employees’ benefits under the plan were frozen. The plan is administered by the trustees of the Financial Institutions Retirement Fund. Because it is a multi-employer plan, there is no separate valuation of plan benefits or segregation of plan assets specifically for the Corporation. During 2006, 2005, and 2004, the Corporation recognized pension expense for this plan of $246,000, $226,000, and $246,000, respectively.

 

 

 

The Corporation has a Defined Contribution Retirement plan for all eligible employees. The Corporation has a matching contribution agreement to match 25% of the first 6% of an employee’s salary (reduced from a 50% match effective October 1, 2006). During 2006, 2005, and 2004, the Corporation recognized pension expense for this plan of $63,000, $64,000, and $64,000, respectively.

 

 

 

Through 2004, the Bank maintained a nonqualified deferred-compensation plan (included as part of the other liabilities section of the consolidated balance sheet) to provide retirement benefits to the Directors, at their option, in lieu of annual directors’ fees and meeting fees. Undistributed benefits are increased by an annual earnings rate which is based on the higher of the Company’s return on average equity or 5.0%. The value of benefits accrued to participants was $410,000 and $402,000 at December 31, 2006 and 2005, respectively. The expense for the plan, including the increase due to the annual earnings credit was $20,000, $20,000, and $59,000, for 2006, 2005, and 2004, respectively.

 

 

 

Upon acquisition, the Corporation assumed the liability for the directors’ deferred compensation plan of MSB Financial, Inc. This plan does not allow for future deferrals and all benefits are being paid out to participants over a 180 month term. Undistributed benefits are increased by an annual earnings rate based on an index which was 5.62% as of December 31, 2006. The present value of benefits accrued to participants (also included as part of the other liabilities section of the balance sheet) is $634,000 and $669,000 at December 31, 2006 and 2005, respectively.

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