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Los Angeles puts Neuberger Berman on organizational watch

The Los Angeles Water & Power Employees' Retirement Plan has placed investment manager Neuberger Berman, which oversees $760.9 million across two fixed-income mandates for the plan, on watch, according to board meeting minutes.

The $14.3 billion retirement plan's board in January approved placing Neuberger Berman on organizational watch because of the departure of Andrew Johnson, managing director and head of global investment grade fixed income, who retired at the end of 2018, board documents published on the plan's website said.

The board approved the action Jan. 23.

Los Angeles could not immediately be reached for comment.

While Los Angeles Water does not expect Mr. Johnson's announcement to materially affect the plan's investment, board documents show, the development triggered a watch list recommendation because of the organizational change. RVK, the plan's investment consultant, recommended that Neuberger Berman be placed on watch for a period of no less than six months to monitor the transition, board documents said.

Neuberger Berman manages an extended global credit fixed income mandate for the plan's retirement and retiree health benefit funds. The mandates have a market value of $651.5 million and $109.4 million, respectively, according to board documents.

On Monday, a Neuberger Berman spokesman confirmed via email that Mr. Johnson retired Dec. 31, and was replaced by managing directors David Brown and Thanos Bardas, who were promoted from senior portfolio manager roles and will serve as co-heads of global investment grade fixed income.

Additionally, managing director Thomas O'Reilly, global head of non-investment grade credit, will retire at the end of this year, at which time, Patrick Flynn, a senior portfolio manager, will succeed him, the spokesman said in an email.

Mr. Flynn will serve as co-head of non-investment grade credit alongside Mr. O'Reilly until his departure.

Mr. Brown, Mr. Bardas and Mr. Flynn report to Brad Tank, CIO, global head of fixed income, in their new roles, the spokesman said.