The District of Columbia Retirement Board, with $4.5 billion in assets, will need to conduct an asset allocation study to best determine how to invest the $1.3 billion in assets that will remain after $3.2 billion in assets - and the fund's $4.8 billion in unfunded accrued liabilities - are transferred to the federal government, according to Jeanna M. Cullins, executive director.
The board now has $2.4 billion in U.S. equities, $756 million in international equities, $859 million in U.S. bonds, $214.1 million in global bonds, $109.3 million in cash, $65 million in alternative investments and $61.6 million in real estate.
The changes will be made under legislation signed into law by President Clinton earlier this month as part of the massive tax package.
Lexington-Fayette Urban County Government, Lexington, Ky., will be considering adding a small-cap equity mandate, an actively managed high-yield bond portfolio and increasing its U.S. aggregate bond index mandate for its $220 million defined benefit plan.
Consultant George Vitta of Asset Strategies Portfolio Services has given his recommendations to the board to diversify the current investment managers' roles. The board has yet to finalize the amounts to be allocated to specific asset classes and will be discussing the asset allocation at future meetings. They have not set a deadline for determining an asset mix, said Mr. Vitta.
California State Teachers' Retirement System, Sacramento, board of trustees approved the preparation of an RFP for a new real estate consultant and the identification of a list of independent real estate fiduciaries that could help with selection of real estate managers.
Previously, the $80 billion fund relied primarily on a real estate consultant alone for that work, but the board and staff believe the tandem approach will strengthen the fund's real estate program and avoid potential conflicts of interest. The wording of the RFP will be brought to the board for approval as early as next month. Institutional Property Consultants, the fund's previous real estate consultant, resigned earlier this year.
Massachusetts Financial Services restructured the MFS Union Standard Equity Fund into a mutual fund and opened it to retail investors. The fund was previously an open-end institutional trust and was designed as an investment vehicle for union pension funds or companies with many union employees. The fund invests in a restricted list of stocks which meet labor sensitivity criteria.
SEARCHES & HIRINGS
Sisters of Charity of St. Augustine (CSA) Health System, Cleveland, hired nine investment managers for its $250 million foundation. Hired were: Boston Partners and Brinson Partners, for large-cap value equity; Oak Associates and Montag & Caldwell, large-cap growth; Seix Investment Advisors, core domestic bonds; Scudder, Stevens and Clark, international equity; Alliance Capital and Scott & Stringfellow, small-cap growth stocks; and Crabbe Huson, small-cap value equity.
John Faulstich, senior vice president of finance, would not give amounts for each assignment. Funding will come from the consolidation of four regional foundations' cash assets. Mercer assisted.
The State of Nevada 457 plan selected ICMA Retirement as its second service provider. The $144 million plan will add 23 investment funds through ICMA effective Jan. 1. The plan already offers 21 funds through ITT Hartford. It added ICMA to comply with a state law requiring investment options from at least two service providers. Other finalists were Aetna Life and Great West Life.
AmSouth Mutual Funds hired Peachtree Asset Management of Atlanta as the subadviser of a new fund, the Capital Growth Fund.
Thomas E. Hobin Jr. has been named national sales director for defined benefit plans at CIGNA Retirement, a new position. He previously was sales vice president at Fleet Bank, where he has not yet been replaced. Mr. Hobin will manage CIGNA's defined benefit sales staff and will be responsible for adding more sales offices by the end of the year.
Scott Gildner, one of the founders of Wellspring Resources, left Wellspring to establish a human resources and benefits outsourcing consulting business. Gildner & Associates will focus on strategic consulting on total benefits outsourcing activities. Mr. Gildner has not yet been replaced at Wellspring.
Tom Marsico left Janus to pursue other interests. He was manager of the more than $5 billion Janus Twenty Fund and the more than $1.5 billion Growth and Income Fund. Mr. Marsico's intentions are not known. Janus named Scott Schoelzel as portfolio manager of the Janus Twenty Fund. He relinquished management of the Janus Olympus Fund to Claire Young, a portfolio manager. David Corkins, an assistant portfolio manager for the Janus Mercury Fund, assumed management of Janus Growth and Income