Oklahoma Public Employees' Retirement System, Oklahoma City, will terminate a $170 million fixed-income portfolio managed by Nicholas-Applegate Capital Management and shift the assets to Firstar Investment Research & Management.
Steve Edmonds, executive director, said the action is part of a reallocation of the $3.4 billion fund's fixed-income assets to eliminate intermediate-term fixed income and increase core bonds. The shift will increase the fund's core fixed-income assets to about $600 million, all managed by Firstar.
Norfolk Southern Corp., Norfolk, Va., may reduce the passive allocation for its $1.2 billion pension fund, said James N. Bayley, director-financial planning. The fund has about 20% allocated to the S&P 500 index, run by Barclays Global Investors. A decision and further details could be available in May or June. Hamilton Co. is assisting.
Minneapolis Employees' Retirement Fund is searching for a REIT manager and is considering hiring a consultant, its first in more than two years. Trustees of the $1.2 billion fund decided to go ahead with the REIT manager search after also considering direct real estate investments, said Farouki Majeed, investment officer. It hopes to complete the search by July and could allocate $15 million to the new manager. Mr. Majeed said the board hasn't set a timetable, but could make a decision on hiring a consultant by July.
Brunswick Securities, the U.S. affiliate of Brunswick Brokerage in Russia, received NASD approval to begin trading local Russian shares with U.S. institutional investors, it was announced today. Brunswick Securities is now permitted to sell underlying, ordinary shares of Russian issuers directly to institutional clients. According to BSI, it is the first U.S. broker-dealer affiliated with an independent Russian brokerage firm to get authority to sell, self-clear and settle transactions in Russian equities to and for U.S. institutions.
SAFECO Life Insurance added three outside fund managers to its participant-directed SAFEFLEX variable annuity product for the 401(k) market: American Century, Lexington Management and Federated Investors. In addition, SAFECO will offer an in-house managed small-cap equity portfolio.
American Century will run balanced and international funds, Lexington will run emerging markets equity and natural resources funds and Federated will run utilities, international stock and high-income bond funds.
About $221 billion, or 8.2%, of the $2.7 trillion market in fixed-income securities held by U.S. insurance companies, mutual funds and leading public pension funds are bonds of non-U.S. issuers, a study by Capital Access International/Capital Access found.
Issues originating from Canada, the United Kingdom and Japan are the most widely held by U.S. institutional investors. Corporate bonds comprise nearly half of the market for non-U.S. debt held by the three types of U.S. institutions. Issuers domiciled outside the U.S. account for more than $110 billion or 11% of the total corporate fixed income securities held by U.S. institutions in these categories.
AIMR this summer will begin a pilot program for advanced certification in equity and fixed income, beyond the charter financial analyst designation.
If successful, the programs will be formally introduced in late summer 1998. Additional specialized certifications could follow.