The $3.2 billion Idaho Public Employee Retirement System expects to drop real estate as an asset class, said CIO Robert Maynard. The fund is doing an asset allocation study and, while he doesn't want to predict what changes the study might recommend, Mr. Maynard said, "I doubt we will continue to use real estate as an asset class."
Dorn Helliesen & Cottle is assisting in the asset allocation study, which Mr. Maynard expects to be presented to the board of trustees around February.
The fund's current allocation is 50% domestic equities, 12% international equities, 33% domestic and global fixed income, 1% cash and 4% real estate.
Effective Jan. 1, Dow Chemical will convert its existing $3.7 billion final-pay pension plan to a pension equity plan - so named because it is designed for benefit values to accrue much more evenly than in traditional "backloaded" plans.
The new plan will benefit employees who join Dow later in their career, or leave the company before retirement. The company also is offering "bridging benefits" to protect older employees through higher accrual rates.
Some 3,500 enforcement cases were suspended and about 600 letters and calls went unanswered at the Pension and Welfare Benefits Administration during the six-day federal government shutdown, said Alan Lebowitz, deputy assistant secretary for program operations.
A skeleton crew was in Washington and the regional offices handled emergency cases, he said.
"It complicates everything and doesn't make our life a whole lot easier," Mr. Lebowitz said.
The $11.38 billion Pacific Telesis Group defined benefit fund, San Francisco, hired Boston Safe Deposit, a Mellon Trust unit, as its master trustee, master custodian and global custodian, said Jerry Koch, director- investment administration. Boston Safe replaces Northern Trust as master trustee and master custodian, and Bank of America as global custodian.
MCL Inc., Bolingbrook, Ill., is terminating its $875,000 defined benefit plan and revamping its profit-sharing/401(k) plan, said Patricia Grigg, human resources manager.
The $2.5 million defined contribution plan will move to an unbundled approach, introducing six new investment options Dec. 1 and moving to M.J. Corp. for daily valued record keeping. To increase participation, the company is adding an employer match of 50% on the first 4% of salary of an employee's contribution.
The new options are a stable value fund managed by Morley, a Dodge & Cox balanced fund, a Vanguard S&P 500 fund, the Seligman Frontier Fund, the Templeton Foreign Fund and the Fidelity Real Estate Investment Fund.
The Labor Department next week is expected to release a laundry list for 401(k) participants to ensure their employer is making plan contributions.
Already, the department has about 300 companies under investigation for allegedly filching millions in contributions from their employees' 401(k) plans.
Some of the items on the employees' defined contribution watch list include: checking quarterly statements to make sure the contributions are being made; checking account balances, making sure the balance doesn't drop without any explanation; and being aware of whether the plan is making loans to the employer and whether the employer is in financial trouble.
David N. Bradford joined Prudential Real Estate Investors as a managing director and portfolio manager of the $2.1 billion PRISA fund. Mr. Bradford replaces John Hoffman who had been PRISA portfolio manager since August 1993.
Mr. Hoffman will stay on as an adviser to PRISA through the first half of 1996, and will then leave the insurer to pursue other interests, said a Prudential source.
Mr. Bradford was formerly senior vice president and assistant portfolio manager with Equitable Real Estate's Prime Property Fund. There are no plans to replace Mr. Bradford.
Aetna Life & Casualty is combining its two investment management units - Aetna Life Insurance and Annuity and Aeltus Investment Management - into one organization effective immediately.
The unit will have $34 billion under management under the Aeltus name.
The combined organization will be headed by John Kim, managing director and chief investment officer. Drew Lawton, managing director-marketing, sales and client service, will report to Mr. Kim.
The combined organization will retain all of the investment professionals from both firms.
There also are plans to hire additional investment staff, according to Mr. Kim.
Fund administrator hired
The $700 million Arlington County (Va.) Supplemental Retirement System hired Bruce Kallos, a former trustee to the Delaware State Employees' Retirement, as administrator.
Robert M. Kowit joined Federated Investors as a vice president and fixed-income portfolio manager, a new position. Mr. Kowit was previously a global fixed-income portfolio manager at John Hancock Advisers.
Mr. Kowit will assume management of the Federated International Income Fund, which had been managed by subadviser Fiduciary Trust International.
He also will manage the global fixed-income portions of Federated's four asset allocation funds, which had been subadvised by Fiduciary Trust.