CONCORD, N.H. — The New Hampshire Retirement System this month strengthened its investment staff, even as continued turnover there left the $5.5 billion Concord-based fund hunting for its fourth executive director in five years.
NHRS officials announced they had hired Richard Shafer as director of investments, a new executive-level position, to oversee the program's investment strategy and management, effective Sept. 15. Jeffrey Gendron, chief investment officer, will report to Mr. Shafer, who retired as CIO of the $35 billion Alaska Permanent Fund, Juneau, earlier this year.
The hiring of Mr. Shafer was simply a matter of beefing up New Hampshire's “bench strength” when it comes to investments, Constance A. Donovan, the system's outgoing executive director, said during a break at the board's Sept. 9 meeting.
Lagging performance has put the fund on the radar screen of Gov. John Lynch, who called for action late last year to boost returns.
For the first six months of 2008, the system's assets declined 6.7%, below the -6% median return for public funds with more than $5 billion in assets in the Wilshire Trust Universe Comparison Service. The system's assets declined another 1% in July.
Some observers point to an asset allocation plan that remains heavy on equities and light on alternatives as one factor behind New Hampshire's below-median returns.
Until April, New Hampshire was targeting 44% of its assets to domestic equities, 16% to international equities, 30% to domestic and global fixed income, and 5% each to commercial real estate and alternatives. Now it is targeting 30% to domestic equities, 15% to international equities, 5% to global equities, 30% to fixed income and 10% each to commercial real estate and alternatives.
At the Sept. 9 meeting, the board approved shifts to boost its combined international and global equity allocations.
The board added $130 million to active international equity portfolios run by Fisher Asset Management LLC, Woodside, Calif., and Thornburg Investment Management Inc., Santa Fe, N.M. Fisher received an additional $50 million, lifting its portfolio to $250 million, while Thornburg's was boosted by $80 million, to $320 million.
Assets were taken from the $70 million remaining from a $220 million international equity mandate run by Edinburgh-based Walter Scott & Partners Ltd. that had been converted to a $150 million global equity mandate. Another $60 million came from rebalancing.