The SEC today adopted rules clearing the way for hedge funds to seek more than 100 investors as long as the investors are ``qualified purchasers.'' The rules implement changes made by Congress last year. Under the new law, institutional investors must have more than $25 million in assets and individual investors must have more than $5 million in investments to qualify. But the rule does not give defined contribution plans with more than $25 million in assets the green light to offer hedge funds to their participants.
Investments of the Washington State Board of Investment, Olympia, are basically sound but operational performance needs to be improved, an audit of the fund presented today found. The audit, issued by state Auditor Brian Sonntag and completed by Independent Fiduciary Services, made 43 recommendations to the $37 billion fund. Among them: create an asset-liability report; establish and staff an internal audit function; seek written clarification from the state attorney general on whether can to hire an outside lawyer.
The PBGC will require the Likes Brothers Steamship Co.'s pension plan to remain active after the company is reorganized. The Tampa-based company planned to ask the bankruptcy court in Tampa to terminate the plan. But the PBGC said Likes didn't follow proper termination procedures. The plan has $38.4 million in assets and $45.6 million in liabilities.
Under the agreement, 75% of the stock of the reorganized company will be owned by a creditor and 25% will be owned by the PBGC. Also, $100,000 will be contributed to the plan.
Santa Clara (Calif.) County Transit District soon will hire a consultant to help it conduct an asset allocation study and select the first external managers for its $108 million pension fund. The fund is now talking to several consulting firms, said Jerry Rosenquist, deputy director. Manager searches will begin after an asset allocation study is completed. The fund now is run by the county treasurer.
The Public Schools Retirement System of Missouri, Jefferson City, likely will promote from within to replace departing Executive Director M. Steve Yoakum. He is leaving the $14.5 billion fund to join Rockwood Capital Advisers as managing director and chief operating officer.
Trustees will interview the fund's two assistant directors, Joel Walters and Keith Bozarth, and Chief Financial Officer Virginia Brizendine at its April 8 meeting.
Staff of the California State Teachers' Retirement System, Sacramento, reports eight districts are joining its new cash-balance investment plan for temporary employees in California school and community college districts. Another nine indicated they intend to join. Investments will be run by the $68 billion CalSTRS fund's existing money managers. The plan's assets are small so far.
Also , selection of CalSTRS' new CIO been slowed by the addition of candidates. Interviews for candidates have been moved to early May, said James Mosman, CEO. He couldn't say how many candidates are in the running for the post now held by Thomas E. Flanigan.
Vermont State Treasurer James H. Douglas today said he is urging the state's three pension systems to sell all of their tobacco holdings, worth more than $21 million. Mr. Douglas anticipates the state attorney general will join 22 other states in suing tobacco companies over tobacco-related medical bills.
Meanwhile, TIAA-CREF, the New York State Teachers' Retirement System, the California State Teachers' Retirement System, the New York City Retirement Systems and the Minnesota State Board of Investment are supporting a shareholder resolution by the New York State Common Retirement Fund asking RJR Nabisco Holdings and Loews to stop marketing cigarettes to teen-agers.
Thirteen pension funds joined the Council of Institutional Investors.
New members are Compaq Computer, Marriott International, Morgan Guaranty Trust's own pension fund; Navistar Corp.; the Indiana Public Employees Retirement Fund; Hartford (Conn.) City Municipal Employees Retirement Fund; Massachusetts Pension Reserves Investment Management Board; Milwaukee City Employees' Retirement System; Montana State Board of Investments; and the Virginia Retirement System; the CWA/ITU Negotiated Pension Plan, IAM National Pension Fund and United Association Local Union Officers and Employees Pension Fund.
Two funds dropped out: Consolidated Freightways Inc. and the Detroit City General Retirement System.
The Roman Catholic Diocese of Rockville Centre, N.Y., hired Putnam Institutional Management to run $25 million in core growth equities for its operating fund. Maureen Scaduto, investment manager. She would not disclose the size of the fund. Funding is from a reallocation. Buck assisted.
P.H. Glatfelter Co., Spring Grove, Pa., hired Bankers Trust as master
trustee of its $335 million defined benefit plans, said Bob Wood, secretary and assistant treasurer.
The search was conducted in-house