The funded status of US corporate pension plans increased by 1.5% on average in May to 91.6%, according to the BNY Mellon investment strategy and solutions group.

But public plans, foundations and endowments missed their targets for the month as flat markets failed to raise the value of their assets.

Discount rates rose for the fourth month in a row, which boosted corporate plans benefiting from lower liabilities. Plan liabilities are calculated using the yields of long-term investment grade bonds. Higher yields on these bonds result in lower liabilities. 

"The rising rates have been the biggest driver in funded status in 2015," said Andrew D Wozniak, head of fiduciary solutions, investment strategy and solutions group.

"While asset returns have only been approximately three percent this year, the funded status has risen more than four percentage points because liabilities have fallen."

US corporate plan assets fell 0.2% in May; while liabilities declined 1.9% as the Aa corporate discount rate rose 15bps to 4.20%.

The funded status is at its highest level since it was 92.0% in June 2014, and it is 4.3% higher than at the beginning of the year.

Public defined benefit plans in May missed their return target by 0.7% as assets declined 0.1%, according to the monthly report. Year on year, public plans are 3.5% below their annual return target, according to BNY Mellon.

For endowments and foundations, the real return in May was -0.6% as assets were flat. Year on year, endowments and foundations are behind their inflation plus spending target by 2.2%.