Santa Barbara County looks to diversify international equity portfolio

Santa Barbara County (Calif.) Employees' Retirement System has launched an RFP for an active international growth and an active international value equity manager, said Eli Martinez, investment officer for the $2.23 billion pension plan.

Funding comes from terminating Lord Abbett, which ran a $70 million active core international equity portfolio. The pension fund's board made the move for diversification; Lord Abbett's portfolio and that of its other international equity manager, PanAgora Asset Management, had highly correlated return streams and close tracking error, Mr. Martinez said.

It has not yet been determined how much each manager would invest.

Responses to the RFP are due on Aug. 1, with selections expected within two months. The RFP is located on general investment consultant Meketa Investment Group's website.

Separately, the board at its June 26 meeting hired DDJ Capital Management to manage a $40 million high-yield portfolio. Funding will come from reducing an $81 million high-yield portfolio of Aberdeen Asset Management that was formerly managed by Artio Global Investors. Pension fund officials are seeking to diversify their exposure to high yield. The board also removed Credit Suisse and J.P. Morgan Asset Management (JPM) from its transition manager panel. Both managers have left the business. The board added Russell Investments to the list as a replacement.