The five pension funds of the New York City Retirement Systems have passed resolutions banning placement agents for all investment classes, Eric Sumberg, a spokesman for city Comptroller Scott Stringer said Monday.
In January, Mr. Stringer, the fiduciary for the $150 billion pension system, said he would ask the boards of trustees for each pension fund to approve a placement agent ban. Mr. Sumberg said in an interview that the board members approved the request at separate meetings from mid-May through early June.
Until the boards took action, placement agents had been banned for only private equity investments by the city pension funds.
“The passage of an ironclad ban on placement agents for all transactions involving the New York City pension funds was long overdue,” Mr. Stringer said in a news release. “Ending the involvement of intermediaries in pension funds' transactions will ensure that the integrity and independence of our investment decisions are beyond reproach and without conflict.”
Mr. Sumberg said only two current investment managers of international equity funds in the city pension system — Thornburg Investment Management and Sprucegrove Investment Management — used private placement agents. They are unaffected by the ban, which covers all future investment management contracts, Mr. Sumberg said.
The $176.2 billion New York State Common Retirement Fund and $104.3 billion New York State Teachers' Retirement System, both of Albany, banned placement agents in April and May 2009, respectively.
