Irwin Financial pension plan assumed by PBGC in light of liquidation

By Caroline Salls

Pittsburgh, Aug. 20 - Irwin Financial Corp.'s underfunded pension plan has been assumed by The Pension Benefit Guaranty Corp., according to a PBGC news release.

The plan covers more than 1,000 of Irwin's former workers and retirees.

The agency said it stepped in because Irwin Financial is liquidating under bankruptcy proceedings, and there will be no sponsor left to fund or administer the plan.

According to PBGC estimates, the Irwin Financial Corp. Employees Pension Plan is 56% funded, with assets of $26.7 million to cover $47.2 million in benefit liabilities. The PBGC expects to be responsible for $19.1 million of the $20.5 million shortfall.

The PBGC said it will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan, which ended on Sept. 18, 2009. The agency assumed responsibility for the plan on Aug. 4.

Columbus, Ind.-based Irwin Financial is the bank holding company of Irwin Union Bank and Trust and Irwin Union Bank, F.S.B. The company filed for bankruptcy on Sept. 18, 2009 in the U.S. Bankruptcy Court for the Southern District of Indiana. Its Chapter 7 case number is 09-13852.

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