California Public Employees' Retirement System, Sacramento, will vote Oct. 18 on whether to issue RFPs for enhanced international index and active international equity managers. In both cases, staff at the $170 billion CalPERS recommended creating a "spring-fed pool" so managers can be funded at the staff's discretion. It is not clear how much will be allocated to the new managers, but most of the funding will come from CalPERS' $23.8 billion in international indexed assets run by State Street Global Advisors. The move would be CalPERS' second into enhanced indexing. In June, the system hired 10 domestic enhanced index managers.
Illinois State Board of Investment, Chicago, issued RFPs for managers to handle $300 million in international small-cap equities and $100 million in mortgage-backed securities, said William Atwood, executive director. More than one firm could be hired for each asset class. The $10.1 billion fund set an Oct. 20 deadline for proposals; RFPs are available from consultant Marquette Associates. Funding for the international small-cap portfolio will come from the board's international large-cap equity managers, he said; none will be dropped. Funding for the mortgage-backed portfolio could come from a $789 million Lehman Intermediate Government/Credit index fund managed by State Street Global Advisors, but a final decision hasn't been made.
Massachusetts Turnpike Authority Employees Retirement System, Boston, issued an RFP for an international equity manager to run $19 million. Proposals are due Oct. 29. The $175 million system has a target international equity allocation of 11%, said Joseph Miletich, consultant at New England Pension Consultants, which is assisting. Mr. Miletich declined to provide further details. Thomas Arcadipane, secretary of the retirement board, did not return calls by press time seeking further information.
Lynn (Mass.) Contributory Retirement Board is searching for its first private equity fund of funds manager; the firm will run $2.5 million. The $160 million pension fund plans to increase its private equity allocation to its target of 5% of total assets, from about 3%, said Kevin Leonard of consultant Segal Advisors. The RFP is available from Mr. Leonard at [email protected] Proposals are due Nov. 9, and a selection is expected by early 2005. Gary Brenner, executive secretary at the pension fund, could not be reached for comment.
Los Angeles Deferred Compensation Plan within the next few months plans to issue an RFP for mutual fund managers to provide a core bond and a core midcap domestic equity fund, said Steven Montagna, senior personnel analyst for the $1.8 billion plan. Currently the plan offers the Morgan Stanley Trust Core Plus Bond Fund; it does not offer a midcap equity fund. Plan officials are not unhappy with the Morgan Stanley fund, he said, but "we're just coming to the time when we should go out to bid on these products."
Missouri Local Government Employees' Retirement System, Jefferson City, will be searching for an investment consultant within the next two to four months. Previous consultant Summit Strategies resigned last month through an agreement with the $2.8 billion fund, said Bill Schwartz, executive director. Bob Ashcroft, chairman of the investment committee, would not comment on why the pension fund parted ways with Summit. Mark Caplinger, consultant with Summit Strategies, did not return a call seeking comment by press time. Custodian Northern Trust will review the pension fund's investment policy and asset allocation for the time being."
National Fuel Gas Co., Buffalo, N.Y., is searching for an active domestic midcap value equity manager, said David Drebot, manager of pension investments. Officials at the $575 million fund expect a selection by the end of the year. He would not provide further information. No consultant is being used, he said.
R.R. Donnelley & Sons Co., Chicago, is conducting an asset-liability study of its $1.8 billion pension fund, which should be completed by the end of the year, said Shaila Karim, manager of trust investments. It is too early to anticipate any recommendations resulting from the study, she said. The pension fund's asset allocation is 90% equity, 10% fixed income. Investment consultant Wurtz & Associates is assisting.
Ohio Public Employees Retirement System, Columbus, might add a portable alpha strategy to its investment mix. J.G. Lee, director of quantitative strategies at the $60 billion fund, said an equity-based portable alpha strategy "is one of many strategies we are discussing," but there is no timeframe for implementation. Portable alpha is attractive because it is a risk-averse way to generate alpha, he said. Neil Toth, director of investments, was traveling and could not return calls for comment.