RETIREMENT PLANS

Defined Benefit Pension Plans and Other Postretirement Benefit Plans

Eastman maintains defined benefit pension plans that provide eligible employees with retirement benefits. In addition, Eastman provides life insurance for eligible retirees hired prior to January 1, 2007. Eastman provides a subsidy for pre-Medicare health care and dental benefits to eligible retirees hired prior to January 1, 2007 that will end on December 31, 2021. Company funding is also provided for eligible Medicare retirees hired prior to January 1, 2007 with a health reimbursement arrangement. Costs recognized for these benefits are estimated amounts, which may change as actual costs derived for the year are determined.

For additional information regarding retirement plans, see Note 10, "Retirement Plans", to the consolidated financial statements in Part II, Item 8 of the Company's 2017 Annual Report on Form 10-K.

Components of net periodic benefit (credit) cost were as follows:



	Third Quarter
	Pension Plans												Other Postretirement Benefit Plans
	2018						2017						2018			2017
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Service cost	$	9		$	3		$	10		$	3		$	—		$	—
Interest cost	16			5			16			5			6			6
Expected return on assets	(36		)	(9		)	(35		)	(8		)	(2		)	(1		)
Amortization of:
Prior service credit, net	—			—			(1		)	—			(10		)	(10		)
Net periodic benefit (credit) cost	$	(11	)	$	(1	)	$	(10	)	$	—		$	(6	)	$	(5	)

	First Nine Months
	Pension Plans												Other Postretirement Benefit Plans
	2018						2017						2018			2017
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Service cost	$	26		$	11		$	28		$	10		$	—		$	2
Interest cost	50			15			49			14			17			18
Expected return on assets	(110		)	(28		)	(105		)	(25		)	(4		)	(4		)
Amortization of:
Prior service credit, net	—			—			(3		)	—			(30		)	(30		)
Net periodic benefit (credit) cost	$	(34	)	$	(2	)	$	(31	)	$	(1	)	$	(17	)	$	(14	)

On January 1, 2018, the Company adopted ASU 2017-07 resulting in non-service cost components of the net periodic pension and other postretirement benefit plans being presented in the "Other components of post-employment (benefit) cost, net" line item of the Unaudited Consolidated Statement of Earnings, Comprehensive Income and Retained Earnings. See Note 1, "Significant Accounting Policies", for additional information.