West Virginia Investment Management Board, Charleston, soon will begin an asset allocation and liability study in anticipation of eventually hiring its first equity managers, said H. Craig Slaughter, executive director.
The board yesterday hired Summit Strategies Group as its first investment consultant. The firm will conduct the study and also will assist with future equity manager searches, which could be as much as a year off. The investment board manages $5.5 billion, including a $2.96 billion pension fund.
Summit's initial mandate includes educating fund trustees on the securities markets. The fund now is invested entirely in bonds and cash, but recently received permission to add stocks. Mr. Slaughter expects the study to be completed within six months.
Callan, Wilshire, Hewitt and RogersCasey were finalists in the consultant search.
State Universities Retirement System of Illinois, Champaign, may boost its commitment to international equities, according to a trustee memorandum. Trustees of the $9 billion fund will consider searching for an additional non-U.S. stock manager later this month. The idea is part of a recommendation to increase its international stock allocation to 20% from 17.5% of assets.
Ennis Knupp will recommend the trustees hire an active international equity manager to add to the three the system now uses. The consultant also will recommend raising the international equity target of 22.5% over time.
New Jersey state lawmakers are expected to pass legislation before the end of the year that would allow the $60 billion New Jersey Division of Investment, Trenton, to use out-of-state banks as custodians, said Roland M. Machold, director. The fund now can use as custodian only banks with principal offices in New Jersey. But with merger frenzy gripping the banking industry, the pension fund is running out of local banks.
The fund has three custodians, Bankers Trust New York, a New York bank with custody operations based in New Jersey; CoreStates Financial, which acquired New Jersey National Bank, one of the fund's custodians; and First Union, which bought First Fidelity Bancorp/N.J., another custodian of the fund.
Hartford Financial Services Group created an investment management subsidiary and moved $48.2 billion in internal assets to the new firm.
The subsidiary, called Hartford Investment Management, will pursue outside business, specifically targeting U.S. institutional assets.
The bulk of the assets now are invested in an array of fixed-income products using a relative-value approach. About $4.5 billion is in equities, using a quantitative approach with a growth or value style. The firm plans to offer both kinds of portfolios to outside clients.
The IRS extended to two years the period within which pension plan sponsors may correct problems they detect on their own without involving the IRS or paying a penalty. Until now, employers had only one year following the period in which the errors occurred to ``self-correct.''
Houston Firefighters' Relief and Retirement Fund has been named the top performing U.S. public pension fund for the five-year period ended June 30 by R.V. Kuhns & Associates. The $1.4 billion fund had a compound annual return of 15.5%, the best of 88 public pension funds included in the survey.
Danny Bowers, CIO of the fund, said the strong returns were largely due to minimal turnover among fund managers, asset allocation and its long-term approach.
The Morgan Stanley Capital International World Index crept up 1.6% in dollar terms in November, while the MSCI EAFE index fell 1.1%. The MSCI Emerging Markets Free Index dropped 3.7% for the month.
Among developed markets, Singapore led with a 9% rise. Malaysia trailed with a 21.3% decline. Among emerging markets, the Mexico Free index climbed 9.7%, leading the pack. Last-ranked Korea's market tumbled 25%.