VW cuts equity allocation
Volkswagen of America cut its strategic equity allocation by eight percentage points to 67% of its $270 million pension fund, said Steven Pramuka, pension fund specialist.
The fund now comprises 48% domestic equities, 19% international equities and the 33% fixed income. Before the change, it was 54% domestic equities, 21% international equities and 25% fixed income. Managers had their assignments proportionally lowered or increased as a result of the move.
Who'll make the move?
Boeing's pension investment staff has been asked to relocate to Chicago along with the corporate management, which announced last week it will move to the new headquarters in September, said Jim Wadhwani, director-trust investments.
Three investment professionals oversee Boeing's $41 billion defined benefit fund and $24 billion 401(k) fund: Gary B. Bland, vice president-trust investments; T. Michael Cappetto, also director-trust investments; and Mr. Wadhwani. In addition, Virginia Gilliam is administrator-trust investments. All have been given until the end of this month to decide whether to move, said Mr. Wadhwani. He said they haven't made a decision.
UNC may boost real estate
University of North Carolina at Chapel Hill may hire several real estate opportunity fund managers, said Mark Yusko, CIO.
The $1 billion endowment probably will increase its real estate allocation to a range of 8% to 10% of total assets, from its current 6.5%.
Funding will come from cash and a possible reduction in REITs, which now comprise 3% of total assets. It also is re-evaluating its domestic value and growth equity mix - currently 63% value, 37% growth - and probably will move toward its target of an even split between the two strategies.
CalPERS eyes 12 firms
CalPERS staff recommended hiring 12 managers for the $152 billion pension fund's new $500 million California Initiative, a program designed to provide financing to underserved markets primarily in the state.
Recommended commitments are: Yucaipa Corporate Initiative Fund, $200 million; Green Equity Partners California Opportunity Fund, $50 million; Levine Leichtman California Growth Partners, $50 million; DFJ Central Fund, $20 million; Blue Capital Partners Fund II, $25 million; Opportunity Capital Partners Fund IV, $25 million; Provender Opportunities Fund II, $25 million; Bank of America California Community Venture Fund, $50 million; California Embarcadero Fund, $25 million; American River Ventures Fund, $10 million; Garage California Entrepreneurs' Fund, $10 million; and Silicon Valley Community Ventures Fund II, $10 million. The investment committee will consider the recommendations May 14.
U. of Iowa study under way
The $400 million University of Iowa Foundation is conducting an asset allocation study, and considering its first international equity and domestic midcap equity investments. The foundation could decide on a new asset allocation this summer, although no specific timetable has been set.
The current allocation is 60% active domestic equities, 10% passive domestic equities, 20% fixed income and 10% alternatives, including distressed debt and private equity. Fund Evaluation Group is assisting.
Triumph, Connecticut settle
Triumph Capital reached a negotiated settlement with the State of Connecticut Trust Funds under which it will immediately return $125.2
million of the $200 million it managed in private equity assets for the pension fund. Triumph will retain indirect control over the remaining
assets, with Harch Capital managing the bulk of the money and Sovereign Financial Services monitoring the account. The Connecticut
Treasurer's office agreed not to pursue further legal action against Triumph.
Bonavitacola leaves Philly
Marc Bonavitacola is leaving his position as CIO of the $5 billion Philadelphia Public Employees' Retirement System. He has no definite plans.
Anthony Johnson, second in command to Mr. Bonavitacola, was named interim CIO while officials search for a permanent replacement, said Janice Davis, chairwoman of the board.
Germany OKs pension reform
Germany's upper house of parliament last week approved landmark legislation that will reduce state-sponsored pension benefits and boost the use of corporate and private pension savings. The reforms, effective January 2002, include tax incentives designed to encourage corporations and individuals to begin funding their pension needs. The bill was supported by Chancellor Gerhard Schroeder.
Peter Koenig, executive director of Morgan Stanley AG, gave the new legislation a cautious welcome. "This is very good, and it makes sense. But a lot will depend on the detail of the regulations and especially the rules for funded pension plans," he said.
Mr. Koenig estimates gross inflows to the new corporate or individual savings accounts of e30 billion to e50 billion ($26.3 billion to $43.8 billion) in 2002.
Teachers mull private equity
The $5.5 billion Indiana State Teachers' Retirement Fund is conducting an asset allocation study with a focus on private equity, said CIO Robert D. Newland.
He speculated the fund could allocate $250 million to the new area. Trustees will determine the allocation after evaluating the results of the study and then could search for managers. Callan Associates is assisting with the study.
Des Mac Intyre to London
Des Mac Intyre was named a director and European head of the pension strategies group at Deutsche Asset Management in London. He was CFO of PlanSponsor.com, and previously was CFO of General Motors Investment Management.
Chris McHugh, PlanSponsor.com's vice president of finance, will assume Mr. Mac Intyre's duties.
401(k) participants stay put
Most 401(k) participants are sticking with their current investing strategies, and some are planning to increase the amount they contribute to their plans, according to the Fidelity 401(k) Confidence Poll of 440 401(k) plan participants in late April. Overall, 79% of respondents said they are very confident or somewhat confident that they will have enough saved when they retire; 67% reported they are more confident or as confident as last year that their savings will meet their retirement needs.
Some 27% said they will increase the amount they are contributing to their 401(k) plans. Sixty-three percent said they will stay at current contribution levels for the rest of the year.