CalPERS terminated Broadmark Asset Management, according to a summary of the $145 billion fund's closed June 16 meeting. Broadmark is the first among the California Public Employees' Retirement System's 12-firm manager development program to be terminated. The firm managed $52 million in a large-cap growth equity portfolio, down from the $100 million it had been awarded by the Sacramento-based system in December 2000. CalPERS retains a 31% stake in Broadmark.
Broadmark was "let go because its performance didn't meet our standards," said Patricia Macht, CalPERS spokeswoman. Daniel J. Barnett, Broadmark CEO, said performance was hurt in the first two months of the mandate, but the firm had outperformed since that time. Broadmark has always been focused on its two long-short strategies, and CalPERS was its lone long-only client, he added.
Separately, in the June closed session, CalPERS' investment committee terminated Brown Capital Management, which handled $470 million in large-cap growth equities, because of underperformance. Further information was not available. Eddie Brown, president, declined to comment. Staff also recommended hiring Bank of New York as the service agent for its recently approved credit enhancement program, which is ultimately expected to produce fee income up to $17.5 million per year.