Illinois State Board of Investment, Chicago, terminated active domestic small-cap equity managers Nicholas-Applegate, which ran a $184 million growth portfolio, and TCW, which managed $130 million in value, said William Atwood, executive director. The terminations were made because of performance, he said. The $7 billion system will consider how to reinvest the money following an asset allocation study slated to begin no earlier than July, once a new investment consultant is hired, he said.
Pending the study, the growth assets were parked in a Russell 2000 growth fund, and $65 million of value assets were parked in a Russell 2000 value fund run by Northern Trust, which already runs $1.8 billion in an S&P 500 fund for the board. The remaining value assets were added to Ariel Capitals existing $130 million active domestic small-cap value portfolio, Mr. Atwood said.
Sue Hunter, Nicholas-Applegate editorial director, said, "There had been short-term performance concerns. We are working on improving performance. Year-to-date (as of last Friday), performance is strong. Officials at TCW did not return a call seeking comment by press time.