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Illinois State Board taps Nomura for high yield, sets $130 million for private equity

Illinois State Board of Investment, Chicago, on Friday hired Nomura Asset Management to run $200 million in high-yield fixed income.

Funding comes from terminating high-yield manager Fort Washington Investment Advisors. The board in December hired high-yield bond manager Brigade Capital Management to manage $200 million, reducing Fort Washington's allocation to $200 million. Fort Washington had been the board's lone high-yield manager.

William Atwood, the board's executive director and chief investment officer, said Fort Washington was a finalist for the high-yield mandates. Meketa Investment Group, the board's general investment consultant, told the investment committee that Fort Washington had been on watch for underperformance.

Officials at Fort Washington could not be immediately reached for comment.

An RFP was issued in August. ISBI has a 3% allocation to high-yield fixed income.

Separately, the board approved committing $50 million each to private equity fund Cornell Capital Partners III and buyout fund Silver Lake Partners V, and $30 million to Hamilton Lane Venture Capital Fund.

The board has a 10% private equity allocation.

ISBI manages $16.1 billion for the Illinois State Employees' Retirement System, Illinois General Assembly Retirement System and Illinois Judges' Retirement System.