Illinois State Board of Investment, Chicago, is undertaking an interim asset allocation study of its $10.1 billion fund, particularly to address liquidity needs, said William R. Atwood, executive director.
Marquette Associates, the board’s consultant, is assisting in the study. It is expected to present the results to the board Dec. 17.
By then, the board should know two important elements that affect investment policy and asset allocation — whether the Illinois General Assembly, scheduled to convene Nov. 16, plans to appropriate funds to contribute to three state retirement systems overseen by the board, and what the three systems will set in October as their actuarial assumed rates of return on investments.
The current assumed rate is 8.5% for the $9.5 billion Illinois State Employees’ Retirement System, and 8% for both the $500 million Illinois Judges’ Retirement System and $100 million Illinois General Assembly Retirement System. All are based in Springfield.
At an ISBI meeting Sept. 24, Illinois Appellate Court Justice Thomas E. Hoffman, board member and chairman of the Judges’ Retirement System, called the current assumed rates “nonsense” and said the new rates should be 5% to 5.5% to better reflect investment reality.
Marquette’s last major asset allocation study for the board was about two years ago and the new study seeks to see what changes might be needed to meet new liquidity needs and to update the overall allocation for a changing outlook on markets, Mr. Atwood said.