Indiana seeks managers
The $10 billion Indiana Public Employees' Retirement Fund is searching for growth and value equity managers to run a total of $1.3 billion in active domestic small-cap, midcap and "smid" (small-cap and midcap), said Patricia J. Gerrick, chief investment officer. "We haven't decided how it will be implemented," Ms. Gerrick said. "I don't know how many managers we will hire. It probably won't be more than five." The fund could hire separate small-cap and midcap managers, or it could hire managers that manage a blend of small-cap and midcap equities, she added. "We are not asking for core managers," she noted. Proposals are due Jan. 30. Plan officials hope to decide on the managers in March. William M. Mercer is assisting.
N.Y. plan to start search
The New York State Deferred Compensation Plan plans to issue RFPs for investment managers offering no-load mutual funds in all major asset classes, and for a record keeper and a trustee/custodian. The $4.7 billion plan is unbundled, "which has worked extremely well, but we will use this time to consider bundled providers as well," said Julian Regan, executive director. RFPs will be available from the plan's lead consultant, Linda Schlissel at Evaluation Associates, within the next couple of weeks, and proposals will be due five or six weeks after their release, Mr. Regan said. The plan has a $2.8 billion portfolio of 25 mutual fund options managed by 14 companies. The remaining $1.9 billion is in a stable income fund, run by 11 managers, which will not be affected by the investment management search.
Paul Silvester, former Connecticut state treasurer, was sent to an undisclosed prison in Massachusetts, said Gary Dorsey, chief deputy of the U.S. Marshall's office in Hartford, Conn. Mr. Silvester, who had been out on bail after pleading guilty to racketeering and money laundering charges in September 1999, had been cooperating with the authorities investigating the case. Bail was revoked after Mr. Silvester admitted in U.S. District Court that he had several contacts with Lisa Thiesfield, a former aide who is one of five defendants scheduled to go on trial in connection with bribes during Mr. Silvester's time in office. Mr. Silvester admitted he accepted kickbacks from numerous private equity firms after he guided the $20 billion Connecticut Retirement and Trust Funds to invest with them. His sentencing date has not been set.
Northwestern names CIO
William H. McLean was named chief investment officer for Northwestern University, Evanston, and will oversee the university's $3.6 billion endowment. He replaces David Wagner, who is retiring after 10 years in the position. Mr. McLean has been senior managing director of asset and investment management at the MacArthur Foundation since 1998.
Korn/Ferry advised on the search.
CommonFund names COO
Verne O. Sedlacek was named executive vice president and COO at CommonFund, a new position. He was president and COO of John W. Henry & Co., and also president and director of Westport Capital Management and Global Capital Management. Mr. Sedlacek is also a past COO of Harvard Management Co., which manages the $19 billion Harvard University endowment fund.
TTX adds Batterymarch option
TTX Co. added the Batterymarch U.S. Small Capitalization Equity Portfolio as an investment option in its $60 million 401(k) plan, replacing a similar option from Capital Guardian, said Anthony Barton, assistant treasurer. The plan offers seven options, he said. Becker, Burke Associates advised. Wilmington Trust is administrator and trustee; Administrative Management Group is record keeper.
Search for consultant
The $82 million Pittsfield (Mass.) Contributory Retirement System is searching for its first investment consulting firm. RFPs are available from Karen Lancto, acting executive director at the Pittsfield Retirement Board.
Savings to be boosted
Most Americans plan to increase their contributions to retirement plans this year, according to a Fidelity Investments survey. About 70% of the 1,200 respondents surveyed in November said they likely will increase their savings in 401(k) plans and IRA vehicles. However, only 15% were aware of the increased opportunity to save as a result of the Economic Growth and Tax Relief Reconciliation Act. About 63% of respondents over age 50 said they will take advantage of the law's catch-up 401(k) provision, which permits them to contribute an additional $1,000 in 2002, increasing to $5,000 in 2006, in addition to the new $11,000 maximum annual 401(k) contribution limit for all age groups.
In addition, 65% of respondents who were saving for college educations for their children or grandchildren said they intend to open a 529 plan account this year.
Hedge fund of funds debuts
LJH Global Investments and Caprock Capital Advisors together launched Caprock Advantage, their first hedge fund of funds, seeking to raise about $100 million from institutional and high-net-worth investors. LJH is known largely as a hedge-fund consultant, and Caprock, a large-cap growth equity manager. Their initial fund combines a fixed-income manager, two market-neutral managers and two long-oriented equity managers.
Bond trading platforms drop
The number of U.S.-based electronic trading platforms for domestic fixed-income securities dropped 28% in 2001, falling to 49 from 68 in 2000, according to a Bond Market Association report. The association cites overcapacity and consolidation as reasons for the decrease. The overall contraction in the Internet economy "has taken its toll," startup platforms found it difficult to obtain capitalization, and investors were "less patient" with unprofitable ventures, according to the report.
Bank of New York gets Autranet
Bank of New York will acquire Autranet, an independently operated agency brokerage subsidiary of Credit Suisse First Boston. Terms were not disclosed, and the deal is subject to regulatory approval.
Autranet will become part of Bank of New York's brokerage and clearing services unit. Autranet will be combined with an existing subsidiary - BNY ESI - to create a large agency brokerage company that will broaden trading strategies as well as pools of liquidity available to institutional clients. Autranet provides third-party research to more than 500 institutional investment managers. Services include research on trade execution, operational and administrative support, research selection and procurement services, and regulatory support.
Separately, BNY Clearing Services, a subsidiary of Bank of New York, will acquire the correspondent clearing business unit of Weiss, Peck & Greer, subject to regulatory approval. Terms were not disclosed.
Johnson joins SSARIS
Earl Johnson was named vice president of institutional sales for SSARIS Advisors, an investment advisory firm launched by State Street Global Advisors last June to develop absolute-return strategies for institutional and private clients. The position is new. Mr. Johnson was director of institutional marketing and sales at Aeltus Investment Management. Officials there did not return calls by press time concerning Mr. Johnson's replacement.
McMenamin returns to H&W
Pat McMenamin joined Hotchkis & Wiley Capital Management as managing director, institutional marketing, and will focus on institutional sales in the Eastern United States. He handled institutional business development on the East Coast for the firm between 1994 and 1996, and then held a similar role at Hotchkis & Wiley's parent company, Merrill Lynch Investment Managers. Hotchkis & Wiley bought itself back from Merrill Lynch last year.
Standards for consultants
The IMCA published a preliminary set of standards for investment consultants acting as fiduciaries to plan sponsors, endowments, foundations, family offices and individuals. The proposed Investment Management Consultants Association standards, which would regulate duties, behavior and responsibilities, are open to public comment - at www.imca.org - for one year before being adopted by the organization. Once the guidelines are adopted, anyone designated as a certified investment management analyst will have to follow them.
Separately, J. Richard Joyner, partner and director of Ernst & Young's Southwest Area Personal Financial Counseling, was elected president of the IMCA board of directors for this year. He replaces Jeffrey Van Orden, three-time president of the board and principal and investment consultant to Milliman USA. Norman E. Nabhan, senior vice president of Salomon Smith Barney's consulting group, was named vice president; Richard J. Davis Jr. president of the Pappy and Davis legal firm, will be secretary; and Jeffrey P. Cusack, senior vice president of Schwab Institutional, will be treasurer.
Wilshire 4500 in real time
The Wilshire 4500 Extended Market index is now available in real time. The American Stock Exchange will publish the small-cap and midcap stock index every 15 seconds and send it to market data vendors.