CHFC 2018 Annual Report

Benefit Obligations and Plan Expenses The following schedule sets forth the changes in the projected benefit obligation and plan assets of the Corporation's Plans: Pension Plan Postretirement Plan SERP (Dollars in thousands) 2018 2017 2018 2017 2018 2017 Projected benefit obligation: Benefit obligation at beginning of year $ 121,361 $ 123,968 $ 2,512 $ 2,601 $ 2,423 $ 2,567 Service cost — 639 3 5 — 61 Interest cost 4,356 4,966 82 94 12 69 Net actuarial loss (gain) (7,048) 10,131 (208) 10 (36) (274) Benefits paid (7,237) (6,432) (189) (198) (2,062) — Curtailment — (11,911) — — — — Benefit obligation at end of year 111,432 121,361 2,200 2,512 337 2,423 Fair value of plan assets: Fair value of plan assets at beginning of year 145,901 132,751 — — — — Actual return on plan assets (10,312) 19,582 — — — — Employer contributions — — — 198 — — Benefits paid (7,237) (6,432) — (198) — — Fair value of plan assets at end of year 128,352 145,901 — — — — Funded (unfunded) status at December 31 $ 16,920 $ 24,540 $ (2,200) $ (2,512) $ (337) $ (2,423) Accumulated benefit obligation $ 111,432 $ 121,361 $ 2,200 $ 2,512 $ 337 $ 2,423 The Corporation did not make a contribution to the Pension Plan in either 2018 or 2017. The Corporation is not required to make a contribution to the Pension Plan in 2019. Weighted-average rate assumptions of the Corporation's Plans follow: Pension Plan Postretirement Plan SERP 2018 2017 2016 2018 2017 2016 2018 2017 2016 Discount rate used in determining benefit obligation — December 31 4.32% 3.68% 4.22% 4.11% 3.41% 3.79% 4.32% 3.38% 3.63% Discount rate used in determining expense 3.68 4.22 4.55 3.41 3.79 4.23 — — 4.51 Discount rate used in determining expense — prior to remeasurement — 3.81 — — — — 3.38 3.63 2.87 Expected long-term return on Pension Plan assets 6.50 6.75 6.75 — — — — — — Rate of compensation increase used in determining benefit obligation — December 31 — — 3.50 — — — — — 3.50 Rate of compensation increase used in determining pension expense — 3.50 3.50 — — — — 3.50 3.50 Year 1 increase in cost of postretirement benefits — — — 7.50 6.50 7.00 — — — Chemical Financial Corporation Notes to Consolidated Financial Statements December 31, 2018 155