Philadelphia Municipal Pension Fund, with $2.8 billion in assets, terminated one manager, placed three others on probation and kept two firms on probation.
George D. Bjurman, which managed $47.3 million in U.S. small-cap stocks, was terminated because of portfolio volatility, said Joseph J. Herkness, executive director. Mercer is assisting in a search for a replacement.
Managers placed on probation were: Sturdivant, which manages about $100 million in U.S. large-cap stocks; Dreyfus Investment Advisors, $77 million in U.S. small-cap equities; and Smith, Graham, $143.3 million in intermediate bonds. Placed on watch was Morgan Grenfell, which runs $123.8 million in international bonds. The fund also is continuing to keep on probation J. & W. Seligman, which runs about $36 million in U.S. small-cap stocks, and Delaware Investment Advisors, which runs about $65 million in U.S. large-cap stocks.
Long duration bond portfolios were the top performers in PIPER's managed accounts for the quarter and year ended June 30. The median long duration bond account returned 5% for the quarter and 9.7% for the year. The Salomon Broad Bond Index returned 3.6% for the quarter and 8.2% for the year. Limited duration fared the worst: The median limited duration portfolio returned 2.2% for the quarter and 6.8% for the year.
Japanese equity portfolios topped the international rankings in PIPER's managed accounts for the quarter, and were at the bottom for the year. The median Japanese equity portfolio returned 22.3% for the quarter, vs. 13.1% for the MSCI EAFE Index. For the year, Japan equity returned -7.83, vs. 13.2% for the index. The median European equity account lead for the year, returning 27.7%.
The worst-performing median international equity account for the quarter was the Pacific Basin excluding Japan, which returned 7.4%.
Domestic equity mutual fund cash inflows for the month of July set all-time records for the traditionally slow month, according to Mutual Fund Trim Tabs. Inflows into U.S. equity mutual funds surpassed $14 billion, well ahead of the previous July record, set in 1995, of $12.2 billion. MFTT attributes much of the strong flows to the surging performance of the U.S. stock market.
Northwestern Mutual Life Insurance Co., Milwaukee, hired M&I Global Securities Lending Group as lending agent for the $600 million international equity segment of its $60 billion general fund portfolio. Northwestern Mutual hadn't lent its international equity securities before.
SEARCHES & HIRINGS
NCR Corp., Dayton, Ohio, placed $5 million in a large-cap growth equity portfolio with Yacktman Asset Management on a trial basis, said Norm Pao, assistant treasurer. If the board of the $2.2 billion defined benefit plan decides to hire Yacktman permanently, the firm probably will run $25 million. Officials will make a decision by the end of the third quarter.
Illinois Municipal Retirement Fund, Oak Brook, Ill., hired Cozad/Westchester to run $75 million in a permanent crop farmland separate account. Funding for the new allocation will come from cash. The fund has assets of $11.1 billion. Institutional Property Consultants assisted.
Jacobs Engineering Group, Pasadena, Calif., added two new funds and dropped another in its $259 million 401(k) plan. AIM International Equity Fund and the Mutual Beacon Fund from Heine Securities were added; the SEI International Fund was dropped, said Diane Hoffman, manager, compensation benefits/corporate human resources.
Mutual Group of Funds, Waterloo, Ontario, hired Mackenzie Financial and AGF Funds to manage a family of seven new mutual funds. Mackenzie will manage the Mutual Summit Dividend Growth, Growth & Income, Equity and Foreign Equity funds. AGF will manage the Mutual Alpine Equity, Asian and Resources funds.
Delta Mutual Funds, New York, hired Utopia Capital Management to manage the Delta Micro-Cap Growth Fund, a new fund that invests primarily in companies with market capitalizations of less than $200 million, with particular emphasis on companies showing increasing sales and/or earnings in the technology, health care and environmental sectors.
Charles S. Stephens, director of investments and treasurer of the United Mine Workers of America Health and Retirement Funds, Washington, is retiring. The fund, with about $7 billion in assets, hired Isaacson, Miller, an executive search firm, to look for his replacement. Mr. Stephens could not be reached for comment. David Bellshaw, a vice president at Isaacson, Miller, said the firm hopes to recommend a replacement in the fall