The largest corporate defined benefit retirement plans recorded record losses – more than $300 billion – last year, killing entire gains from the previous five years, new research shows.

The ongoing financial crisis is blamed for most of the losses reported last year in the Milliman 100 Index companies, according to the Ninth Annual Milliman Pension Funding Study.

“Asset losses drove a decrease in funded status from about 106% at the end of 2007 to less than 80% at the end of 2008,” said study co-author John Ehrhardt.

In the first two months of this year, those firms already indicated more than a $30 billion decrease in funded status, he said, noting that the funded status of the Milliman 100 pension plans stood at 74% at the end of February, marking the lowest level since May 2003.

The loss in funded status in 2008 is projected to produce an increase in pension expense for 2009 and a charge to corporate earnings in excess of $70 billion. Employer contributions to the Milliman 100 pension plans increased only slightly in 2008, to $29.7 billion, from $27.2 billion in 2007, researchers said.

The losses in funded status during 2008, coupled with the new funding requirements under the Pension Protection Act, are projected to increase required contributions to over $50 billion for this year for those firms.

The percentage of pension plan assets invested in equities declined from 55% to 44% during 2008. “The decrease in equity allocations is primarily due to market declines and, to a much lesser extent, a change in investment policies,” said study co-author Paul Morgan of Evaluation Associates. “A return to a 55% equity allocation by the end of 2009, either through new investments or portfolio rebalancing, would require a $100 billion investment in the equity markets.”

Milliman’s Pension Funding Study is based on pension plan accounting information disclosed in the annual report footnotes of the 100 largest corporate pension plan sponsors, by assets for the 2008 fiscal year and previous years. These numbers represent the GAAP accounting information public companies are required to report under Statements of Financial Accounting Standards 87, 88, 106, and 132. They do not reflect the funded status of the companies’ U.S. qualified pension plans under ERISA.