The Philadelphia Municipal Pension Fund, with more than $2.8 billion in assets, has ended its options overwriting program and terminated Analytic TSA, after suffering disappointing results, said Joseph J. Herkness, executive director.
``It was not Analytic so much as the concept of options overwriting had not performed,'' said Mr. Herkness. Loomis Sayles, the other options overwriting manager already had been terminated some time ago, he said. Analytic could invest up to a few percentage points of the fund's equity exposure in options overwriting, he said.
SEI Investments launched a program to assist smaller tax-exempt funds manage their assets and liabilities. SEI will combine its existing manager-of-managers funds with asset-liability consulting services. The program will be sold through registered investment advisers and financial planners, who can target pension funds, endowments and foundations with $5 million to $25 million in assets. SEI's research shows most funds in that category are not globally diversified, and do not do a good job of matching assets with liabilities.
Inco United States Inc., New York, is searching for a fixed-income manager, expected to be hired in the middle of this year, said Kurt Barnes, president of Inco IMS Investment Services, the in-house investment management arm.
Hoisington Investment Management now is the $160 million defined benefit plan's sole fixed-income manager. The funding for the new firm will come from new contributions.
The search is being conducted internally and fund officials are in the process of reviewing a large list of managers. Inco officials are not considering adding any new firms to the list of managers being reviewed.
Norges Bank, Oslo, might hire additional fixed-income managers to manage a portion of its foreign currency reserves, said Leif Eide, executive director of the bank's monetary unit.
Norway's central has just hired its first external managers. ABN AMRO Asset Management (UK) will manage a 150 million deutsche mark fixed-income portfolio that can be invested in instruments denominated in marks, French francs, sterling, guilders, Belgian francs, Danish krone, Swedish krona and ECUs. Goldman Sachs Asset Management will invest a $100 million fixed-income portfolio in U.S.- and Canadian-dollar instruments. Bankers Trust was hired to provide custody and performance analysis for both portfolios.
Mr. Eide said the bank will assess the managers after some months and will either increase their allocations or hire additional firms, but the current thinking is to increase the number of managers.
Gates Rubber Co., Denver, hired Boston Partners Asset Management to handle a $12 million small-cap equity allocation. The assets came from another manager, said Marlin Dorhout, manager of the $330 million defined benefit plan; he declined to identify the manager. Mercer assisted in the search. No other searches are planned.
Intergraph Corp., Huntsville, Ala., added five Dreyfus funds to its $200 million defined contribution plan, said Beth Medley, manager of employee investments. Funds added were: a short-term bond fund, a balanced fund, a small-cap fund, an appreciation fund and an international equity fund run by Templeton through an alliance with Dreyfus.
Fund officials didn't terminate any other fund managers, although some of the new funds will overlap with existing offerings. Fidelity currently manages a balanced fund; Boston Co., a bond fund; and Smith Barney Investment Advisors, an appreciation fund. It is possible some managers could be terminated in the future depending upon how participants direct their assets, said Ms. Medley.
The Benefits Connection Group, Washington, added nine options to its defined contribution plan and moved to daily from monthly valuation, said Jim Brodsky, president. Options added were from Dreyfus, Templeton Investment Counsel, Fred Alger Management and Certus Asset Advisors. Dreyfus will manage most of the new funds, which are an S&P 500 fund, a small-cap fund, a discount brokerage fund and three lifestyle funds. Templeton will manage an international fund; Alger a growth fund; and Certus a stable value fund.
Participants of the $250 million plan formed focus groups and decided there was a need for better access to funds and more diversity in options. Evaluation Associates assisted.
William W. Pierce joined Zurich Investment Management as managing director, a new position. He now markets institutional management services in the Midwest.
Mr. Pierce had been marketing director at Lord Asset Management, where his replacement is being sought. Virge Trotter, senior research officer and vice president, assumed his duties on an interim basis