New York State Deferred Compensation Plan, Albany, hired three firms to manage $1.02 billion in its Stable Income Fund.
Each contract is for $340 million, and each takes effect on Oct. 1. The contracts run for 10 years.
Wells Capital Management will run a short-term fixed-income portfolio. J.P. Morgan Asset Management and Income Research & Management will run intermediate-term fixed-income portfolios.
The board issued an RFP in February.
The new managers replace BlackRock and Goldman Sachs Asset Management, which are currently running a $600 million short-term fixed-income portfolio and $436 million intermediate-term fixed income portfolio, respectively, for the $17 billion plan.
BlackRock was invited to re-bid. GSAM was precluded from bidding because of the deferred compensation plan's conflict of interest policy, said Edward Lilly, executive director. GSAM is the Stable Income Fund's structure manager. Dwight Asset Management had been the structure manager, but Dwight was acquired by Goldman Sachs Group in 2012.
Separately, David Fischer has been promoted to executive director of the deferred compensation plan, replacing Mr. Lilly, who retires next week after having served as executive director since 2007.
Mr. Fischer has been deputy director for six years. His promotion was approved unanimously by the board Friday.
The board's chairwoman, Diana Jones Ritter, said in an interview that Mr. Fischer had been groomed to succeed Mr. Lilly. “We were purposeful in our succession planning,” she said. “We knew Ed was planning to leave, and we were preparing David to succeed him.”
The board expects to choose a new deputy director in about six months. “We want to give David time to assess what we need,” she said.
Also at the meeting, board members voted to rehire CliftonLarsonAllen as the plan's auditor for a five-year contract starting in October. The board issued an RFP in February.