Arizona Public Service Co., Phoenix, is beginning an asset allocation study for its $700 million pension fund, said Jerry White, trust investment administrator. The company hired Towers Perrin to assist with the study.
Arizona Public officials still are determining the scope of the study, which may be completed in the spring. The fund's asset mix as of Sept. 30 was 55% stock, 35% bonds and 10% real estate.
Orange County Employees' Retirement System, Santa Ana, Calif., is shifting $90 million from its real estate program to its two international equity managers, Schroeder Capital Management and Capital Guardian.
The move was the result of the $3.8 billion fund's investment committee recommendation to increase its international equity allocation to about 14% of assets from 12%. The allocation will be limited to EAFE portfolios, not emerging markets portfolios. Callan Associates is assisting.
Ray Fleming, fund administrator, declined to say which of the fund's real estate managers would supply the $90 million in assets.
California Public Employees' Retirement System, Sacramento, earned an estimated 19% total return for calendar year 1997, 6.1 percentage points above the previous calendar year.
The $128 billion fund also beat its own weighted performance benchmark of 18.7%, compiled by State Street Analytics, a unit of State Street Bank.
CalPERS officials said in a statement that year-to-year performance was helped by increasing the domestic equity allocation to 41% from 31% of assets. They also cited the fund's $250 million stake in a partnership with Enron Corp. in the Joint Energy Development Investment; that investment returned nearly 32%, more than twice the benchmark. The fund's total equity investments earned 23.8% in 1997. Its domestic equity weighted benchmark was 23.2%.
San Jose (Calif.) Retirement Systems placed Chancellor LGT on probation because of recent personnel departures and the pending sale of the firm.
Chancellor LGT manages $60 million for the city's $1.3 billion police and fire fund and $60 million for the $900 million federated employees plan. Both U.S. large-cap growth equity portfolios. Officials will wait and see what develops at the firm, said Ed Overton, retirement administrator. The system may know more by the end of February, he said.
Behrman Capital closed its Behrman Capital II L.P. after raising $518 million from pension funds and other institutional investors, a company spokesman said. Investors in the fund include the pension funds for Pfizer Inc., Mead Corp., Unisys Corp. and The National Geographic Society.
Other investors included the California Public Employees' Retirement System, which committed $150 million; the New York Common Retirement Fund, which committed $50 million; and the Kansas Public Employees' Retirement System.
Brookline (Mass.) Retirement Board will conduct an asset allocation study as soon as it hires a new consultant, said William Wolf, director of retirement.
The $120 million fund, which has been conducting a consultant search, plans to pick finalists at its Feb. 23 meeting and make a final selection in March, he said.
The Brookline fund has been using Watson Wyatt, whose contract ended in December.
The bulk of the fund's assets is in balanced funds (with about 43% in stocks, the remainder in fixed income) with two managers, State Street Research and Loomis Sayles. The fund also has about $5 million in non-U.S. stocks with Guinness Flight; about 5% of its portfolio is in cash. The fund, he said, is ``just going to diversify the portfolio.''