Wyeth-Ayerst Canada Inc., Markham, Ontario, is doing an asset allocation study and review of the four investment managers for its C$250 million (U.S.$173 million) pension fund, said R. Bruce Brodie, treasurer. William M. Mercer is assisting in the study, which the fund hopes to complete in a couple of months.
The fund's allocation is 53% Canadian equities, 20% non-Canadian equities, 26% Canadian fixed income and the rest is in cash.
Brinson Partners manages non-Canadian equities; RT Capital Management, Canadian equities; Phillips Hager & North, Canadian balanced; and Perigee Investment Counsel, Canadian fixed income.
A lawsuit has been filed challenging a legislative measure restricting Texas state agencies, including public pension funds, from investing in companies that produce violent or sexually explicit music. The lawsuit, filed in Travis County District Court, Austin, claims a rider to the state's general appropriations bill during the 1997 session was unconstitutional and an ``impermissible attempt to legislate general law through a mechanism of a budget rider.''
The plaintiffs, which include the Recording Industry Association of America and individual members of several Texas pension funds, also claim the rider unnecessarily restricts investment management and breaches the requirement that the management of state pension funds be guided by investment principles.
Chicopee (Mass.) Contributory Retirement system has added $1 million to a small-cap domestic growth stock fund with State Street Research, $2 million to a PRIT core real estate fund, and $1 million to an international stock pooled fund with Scottish Equitable. Assets came from liquidating its $4 million in a portfolio capital appreciation fund with State Street Research, said Ruth Corridan, executive director. The fund added the portfolio to reach investment goals.
The $82 million fund's targets are 50% U.S. stocks, including 5% in small-cap equities; 5% in non-U.S. stocks; 5% in real estate; and 40% in U.S. bonds.
Northern Trust Risk & Performance Services, Chicago, unveiled a new group geared to help pension plan sponsors manage total portfolio risk.
Called Integrated Risk Management, the Northern Trust group offers risk review services, monitoring and analysis, using staff and computers. Mike McGlinn, senior vice president in Risk & Performance Services, will run the new division.
Relatively high PBGC insurance premiums might be discouraging companies in low-wage industries from offering traditional pension plans, a study by Watson Wyatt Worldwide says.
About 20% of all plans with more than 1,000 participants pay around $50 per participant to the PBGC. Assuming a mix of retirees, vested but terminated employees and active workers, this can work out to between $75 and $90 per active employee. Consequently, a company in a low-wage industry that wants to provide $300 of benefits annually to each worker might find that a hefty portion of that goes toward PBGC insurance premiums, the study found.