Oregon Investment Council, Tigard, which manages the $51.5 billion Oregon Public Employees Retirement Fund, Salem, has restructured its $20.8 billion equity portfolio, increasing its passively managed target allocation by five percentage points to 25% of the portfolio and reducing its actively managed target by five percentage points to 75%, said spokesman James Sinks.
As part of the restructuring, staff will manage an internal synthetic Russell 2000 Index portfolio of undetermined size, and hired Dimensional Fund Advisors for a $100 million emerging markets small-cap strategy and Westwood Global Investments for a $100 million emerging markets strategy, Mr. Sinks said.
The council will also put some of the $1.7 billion invested in the AllianceBernstein Global Style Blend portfolio into a $726 million global strategic value and a $311 million global research growth separate accounts, with a smaller global research growth allocation in favor of passive assignments.
Separately, the council will commit $100 million to Sageview Capital's Community Bancorp, a private equity fund, contingent on successful contract negotiations, Mr. Sinks said.
Community is being formed to take advantage of the distressed and undercapitalized nature of many U.S. banks, according to material provided to the council in a memo from Jay Fewel, the council's senior private equity investment officer. Unlike a typical private equity investment, Oregon PERF would own shares directly in Community Bancorp, the holding company, rather than limited partnership interests. Sageview is targeting about $1 billion for Community Bancorp.
If a deal is worked out, OPERF's commitment would be contingent on Community Bancorp's raising a minimum of $500 million. The Sageview team is committing $10 million.
The council also approved redeeming its entire position in AQR/CNH Partners Convertible Bond Fund. The council had invested $150 million in May and has earned an 11% return on the investment, Mr. Sinks said, adding that it is redeeming its entire position because the investment opportunity has passed.