Equity manager salaries drop
The top-quartile total compensation of senior equity portfolio managers dropped 14% between 1996 and 1999, according to a new report from Investment Counseling Inc.
The top quartile total compensation of equity portfolio managers was $515,000 in 1999, compared with $600,000 million in 1996.
Marketing directors made out like bandits, with compensation of the top quartile up 335% in 1999 to $1.174 million, from $270,000 in 1996.
CIOS in the top quartile garnered a 127% increase in total compensation to $2.216 million in 1999, up from $976,000 in 1996.
Chairmen, presidents and CEOs were the best compensated in the money management industry, according to the data. Their top-quartile total compensation in 1999 was $3.362 million, compared with $1.916 million in 1996.
San Fran makes changes
The $12 billion San Francisco City & County Employees' Retirement System will revamp part of its $1.3 billion international core equity allocation, study currency management and consider altering its emerging markets allocation.
A $475 million core international portfolio managed by Oechsle International Advisors will be split evenly between Oechsle (but converted to a concentrated portfolio of 25 to 40 stocks) and Nicholas-Applegate, which will manage a core portfolio with a growth bias.
The board also voted to find an active currency manager to determine whether such management would have enhanced returns for the fund.
In addition, trustees voted to evaluate the fund's emerging markets exposure because Oechsle and Nicholas-Applegate are authorized to make substantial investments in the area. The review could affect a $240 million emerging markets portfolio managed by Capital International.
InvestorForce was the consultant.
Allocation study planned
Mr. Bruebaker doesn't anticipate any major changes in the fund's asset mix of 36.1% domestic equities, 15.1% international equities, 13.6% private equities, 7.6% real estate, 27.4% fixed-income and 0.2% cash.
Missouri switches custodians
The $5.5 billion Missouri State Employees' Retirement System hired Mellon Trust Global Securities Services group as master custodian, according to Rick Dahl, CIO.
Mellon replaces Deutsche Bank, which acquired the account when it bought Bankers Trust in 1999.
Mellon will provide custody and accounting services, while Russell/Mellon Analytical Services Inc. and Measurisk, in a joint effort, will supply performance measurement and risk analysis.
Indiana fund picks CIO
Patricia Gerrick was hired as chief investment officer of the $12 billion Indiana Public Employees' Retirement Fund, a new position. She currently is director of international investments at the $120 billion New York State Common Retirement Fund.
Ms. Gerrick will report to E. William Butler, executive director.
Omnova hires 2
Omnova Solutions hired active domestic midcap equity manager The Boston Co. Asset Management to run a $10 million value portfolio and Westfield Capital to manage a $10 million growth protfolio for the firm's $250 million pension fund.
The moves resulted from an asset allocation study done after Omnova spun off from Gencorp.
YMCA taps Putnam
The YMCA Retirement Fund hired Putnam to run $200 million in active international large-cap equities benchmarked to the Morgan Stanley Capital International All Country World index ex-U.S. for the $3.5 billion 403(b) plan, said Victor Raskin, chief investment officer.
Funding comes from a temporary $200 million EAFE index fund run by State Street Global.
Iowa adds 401(a) plan
The Iowa Department of Personnel added a 401(a) plan that will be funded in April. Plan officials wanted a vehicle for contributing employer match money that will not reduce the employees' maximum contribution limit, said Robbie Stoecker, retirement benefits officer.
Trustees also revamped the plan's $225 million 457 plan, reducing it to about 100 options offered by four providers from more than 200 investment options offered by 11 providers; the same options will be offered in the 401(a), she said.
The plan retained service providers Aetna, Equitable Life Assurance, Hartford Life and VALIC/American General; cut from the plan were Equitable Life Insurance of Iowa, Farm Bureau Financial Services, Great West, MassMutual, Nationwide Retirement Solutions, New England Financial and PFL Life Insurance.
401(k) balances grow
The average account balance of defined contribution plan participants grew 7% between 1998 and 1999, according to Fidelity Investments' new Building Futures Report.
Average balances generally increased with plan size, from $41,000 for defined contribution plans with fewer than 50 participants to $82,000 for plans with 10,000 or more participants.
Participation rates remained at 75% of eligible employees, but deferral rates declined. The average deferral rate for non-highly compensated participants was 6.7%, down from 6.8% the year before, while the average deferral rate for highly compensated participants was 6.4%, down from 7% in 1998.
The average plan's rate of return was 19%, compared with the S&P 500's 1999 return of 21%. And the average number of investment options rose to 10 in 1999, from nine the year before.
Searches on the rise
William M. Mercer's global investment consulting practice conducted a record 800 investment manager searches last year, up 4% from 1999. Assets placed as a result of the searches totaled $61.5 billion, up 18% from 1999. Fifty-four percent of the searches for 2000 were in Europe; 34% were in North and South America, and 12% in Asia.
In the United States, large-cap value equity was the single most popular asset class, accounting for 39 searches and just more than $2 billion in assets placed. International equity was the most popular single product category across Mercer's worldwide client base, accounting for about 15% of the total number of searches last year.