WASHINGTON — Evergreen Investment Management faces possible enforcement action from the SEC over allegations of market timing and rapid trading of Evergreen's own mutual funds, according to a 10-Q filing by Evergreen's parent, Wachovia. Staff at the SEC, which is considering whether to recommend action against the firm, alleged that between December 2000 and April 2003, a former Evergreen employee allowed an individual broker to exceed trading limitations set out by Evergreen's mutual fund prospectus; it also claimed a former Evergreen manager conducted "purchase and sale activity" in the mutual fund he managed at the time. Wachovia said it "intends to make a written Wells submission" to the SEC "explaining why Wachovia believes enforcement action should not be instituted," according to the filing. Evergreen spokeswoman Laura Fay declined to provide further details.
SEC considers action against Evergreen, alleges market timing, rapid trading
ALBANY, N.Y. — New York State Teachers' Retirement System authorized a new $1 billion internally managed S&P 500 index fund that will weight each stock in the index equally, said Dave Daly, spokesman for NYSTRS. The $80.2 billion system will also put $1 billion in an existing internally managed S&P 600 index fund, boosting it to $2.2 billion. Funding for both investments will come from reducing the system's $33.4 billion internally managed S&P Super Composite 1500 index fund.
BOSTON — Putnam Investments saw a $14 billion decline in assets under management during the second quarter, to $213 billion, according to an announcement by parent Marsh & McLennan. Total assets under management for the quarter were down 20% from the same period a year ago. Institutional assets fell $5 billion to $65 billion, less than the $7 billion decline reported in the first quarter, but mutual fund assets were down $9 billion to $148 billion as of June 30, compared with the $6 billion decline of the previous quarter. Revenue dropped 10% to $446 million in the second quarter, compared with the same period last year, while operating income tumbled 24% to $95 million.
"We continue to move forward as a firm focusing on rebuilding investor confidence and delivering consistent, dependable, superior investment performance over time," Putnam officials said in a statement. Jeffrey W. Greenberg, Marsh & McLennan chairman and CEO, said in a conference call that MMC is as committed to Putnam as it has ever been.
Richard Monaghan, senior managing director at Putnam, couldn't be reached by press time for comment.
NAPERVILLE, Ill. — Calamos Asset Management plans to issue an IPO aimed at raising up to $100 million, according to a filing with the SEC. In the filing, Calamos said some of the proceeds will be used to expand its alternative investment business.
The company's assets under management surged to $32.3 billion as of June 30, from $9.3 billion at the end of 2001, helped by strong gains posted by its convertible bond and growth equity strategies. Officials at Calamos couldn't immediately be reached for comment.
ATLANTA — Georgia-Pacific Corp. reduced its estimated 2004 expense on its $3.44 billion pension fund by $19 million to $188 million, but still expects to contribute $207 million to the fund this year, according to the company's 10-Q report. The reduction in pension expense is mainly due to an adjustment of Georgia-Pacific's salaried pension plan in connection with the sales of its building products distribution segment and its non-integrated pulp mills, according to the filing.
The company contributed $107 million as of July 3, according to the filing. Georgia-Pacific contributed $119 million to its pension fund in 2003 and reported $238 million in pension expense, according to the firm's 2003 annual report.
BOSTON — Massachusetts Pension Reserves Investment Management Board, Boston, on Oct. 5 will recommend a fifth hedge fund-of-funds manager to run $325 million, replacing Silver Creek Partners. The $32.6 billion system broke off talks with Silver Creek Partners because of differences over fees.
In October, MassPRIM will also review its currency overlay strategy to see if that coverage should be expanded or trimmed, said Jerrold Mitchell, chief investment officer. Currently, Pareto Partners hedges 25% of the fund's international equity exposure.