Coleman Stipanovich today resigned as executive director of the $187.5 billion Florida State Board of Administration, Tallahassee, following recent losses from defaults of structured investment vehicles in the $14 billion local government investment pool. Mr. Stipanovich has been executive director for seven years.
Mr. Stipanovich made the announcement at a Florida state Cabinet meeting; he said he would discuss a timetable for his departure with SBA trustees. Nothing was said about naming an interim executive director or initiating a search for a replacement.
His announcement came near the conclusion of a Cabinet meeting on the investment losses. Florida Gov. Charlie Crist asked, “Coleman, do you have any final comments for us?” Mr. Stipanovich said he had given thought to “doing the right thing” and “the decision is to step down as executive director of the State Board of Administration.”
“There is nothing more important to me, except my family and friends, than to restore the confidence from the people in the State Board of Administration,” Mr. Stipanovich said. “I hope my actions today help the State Board of Administration to move forward.”
Also today, trustees directed the board to search for investment management firms for the internally managed local government investment pool. BlackRock, which trustees hired to advise on the restructuring, was named interim manager of the pool for 90 days in expectation that the search process will be completed by then. No further details about the RFP were available.
The pool is expected to open for limited withdrawals Thursday, Chris Stavrakos, BlackRock managing director and co-head of cash portfolio management, said at today’s meeting. The pool was closed to withdrawals Nov. 29; it was valued at $27.3 billion on Sept. 30 and fell to $14 billion Nov. 29, in part because of withdrawals.
The pool will be split into two funds. Fund A will invest $12 billion in high-quality money market instruments, and Fund B will consist of the remainder of the assets, which are securities in default, impaired or present significant credit risk.
