New Mexico Ed hires 2
The $12.5 billion New Mexico Educational Retirement Board hired Perimeter Capital to run $140 million and Wells Capital to run $80 million, both in active domestic small-cap growth equities, said Frank Foy, assistant CIO.
Funding came from terminating Franklin Templeton from a similar portfolio for performance reasons. A spokeswoman said Franklin Templeton officials wouldnt comment. New England Pension Consultants assisted.
Court: CalSTRS should get $$
CalSTRS is entitled to receive $500 million in contributions that the state withheld in 2003, according to a decision by Californias 3rd District Court of Appeal. Officials of the $169 billion system estimated the fund will receive an additional $200 million in interest payments.
Ex-Janus manager sues
A former Janus portfolio manager contends that CEO Gary Black told the companys portfolio managers last October that they would receive pay cuts, even though he was aware such a move would violate their contracts, according to a lawsuit filed last month.
Edward Keely, who oversaw about $1.2 billion in institutional growth equity portfolios at Janus before he resigned in May filed the suit Aug. 21 in Denver District Court, InvestmentNews, a sister publication, reported. The suit alleges breach of contract and seeks damages and back payments of $3.8 million.
A spokeswoman for Janus Capital Group declined to discuss the lawsuit. The company, however, filed a response to the suit last week, arguing that it did not breach its obligations to pay Mr. Keely under the terms of his contract.
Janus also claims that while Mr. Black did call a meeting of portfolio managers in 2006 during which compensation issues were discussed, he did not say changes Janus planned to implement would violate their contracts.
Louisiana switches gears
The $9 billion Louisiana State Employees Retirement System hired GAM to manage $150 million in a multiarbitrage strategy in a hedge fund of funds, said Bobby Beale, CIO.
The system hired GAM after contract negotiations failed with EIM, the firm the system originally hired in June.
An EIM spokesman said it is the groups policy not to comment.
Committees to eye tax issues
The Senate Finance Committee will hold a hearing Sept. 6 to explore concerns that raising taxes on carried interest could have an adverse impact on pension funds, according to a news release.
The House Ways and Means Committee also announced a hearing on Sept. 6 to look at a variety of tax fairness issues, including the tax treatment of investment fund managers, according to a committee news release.
Lawmakers in both chambers are considering proposals that would increase to 35% the levies hedge fund and private equity managers would have to pay on carried interest. The carried interest of investment partnerships is now taxed as capital gains at 15%.
Santa Barbara shifts on EAFE
The $1.9 billion Santa Barbara County (Calif.) Employees Retirement System moved $127 million into an EAFE index account run by SSgA, increasing it to $189 million, said Oscar Peters, retirement administrator.
The money had been in an active EAFE equity portfolio managed by Pyramis Global Advisors, which was terminated for performance.
This is a significant and well-funded investment strategy with an experienced investment team, and were fully confident in the portfolio management team and the process they employ , said Jenny Engle, Pyramis spokeswoman.
The funds board will decide whether to leave the money with SSgA or hire another active manager following an asset allocation study that will begin in January.
The board will also consider increasing its $48 million emerging markets equity allocation and might add an additional emerging markets manager.
The fund also is conducting an invitation-only search for opportunity and value-added real estate fund managers. A selection is expected by Dec. 31.
Pension Consulting Alliance is assisting.
Teachers goes opportunistic
The $8.9 billion Indiana State Teachers Retirement Fund will invest $40 million to $50 million in opportunistic real estate, including international, said Robert D. Newland, CIO. The fund will take a regional approach, but it is not yet clear in which areas the fund will invest, Mr. Newland said. Funding will come from domestic equities. Callan is assisting.
ING hunts for value option
ING North America Insurance is conducting an invitation-only search for an active domestic large-cap value equity mutual fund for its $1.1 billion 401(k) plan, said Darryl Harris, pension committee chairman.
Mr. Harris said the committee hopes to have a selection in place by the end of the year. Watson Wyatt is assisting.
AFL-CIO to push health care
The AFL-CIO will make universal health-care coverage one of its top issues during the next corporate proxy season. The union plans to file proxy proposals urging companies to back more expansive health care for their employees as well as publicly support its goal of universal coverage by 2009, Dan Pedrotty, director of the unions office of investment, told FinancialWeek, a sister publication.
The union also will ask companies to file reports on political contributions by directors and executives to flush out corporate names backing political candidates who oppose universal health care. And it plans to especially target companies that share directors with pharmaceutical company boards, seen by the AFL-CIO as powerful opponents of universal health care.
Public plans report returns
The $67 billion Pennsylvania Public School Employees Retirement System reported a 22.9% return on investments for the fiscal year ended June 30, thanks in part to a 36.1% return on private market investments, which comprises private debt.
Non-U.S. equities returned 31.3%; real estate, 30%; and U.S. equities, 20.4%.
The $9.1 billion Louisiana State Employees Retirement System returned 19.2% for the year ended June 30.
The Massachusetts Public Employees Retirement Administration Commission reported a median return on investments of 14% for the year ended Dec. 31 for the two state and 104 municipal, county and regional pension systems whose investments it oversees, said Robert Dennis, investment director.
The $27 million Clinton Retirement System returned 18.1%, the highest among all PERAC funds.