Kentucky pension funds post 1.2% return for fiscal year

Kentucky Retirement Systems' pension funds returned an aggregate net 1.2% for the fiscal year ended June 30, confirmed David Eager, executive director.

The $18.2 billion Frankfort-based retirement system, which includes $12.7 billion in pension plan assets, saw the pension funds outperform the benchmark of 0.5% for the fiscal year.

For the three, five and 10 years ended June 30, the pension funds returned an annualized net 5.1%, 5.6% and 7.4%, respectively, compared with the respective benchmarks of 4.8%, 5.4% and 7.6%.

KRS' five pension funds returned an aggregate net 5.8% for the fiscal year ended June 30, 2019.

By asset class, the best performer was real estate, which returned a net 9.8% for the fiscal year ended June 30 (above its benchmark of 3.9%), followed by core fixed income, which returned a net 5.3% (below its 8.7% benchmark).

Other asset class returns were domestic equity, which returned a net 4.9% for the fiscal year ended June 30 (below its 6.5% benchmark); high yield/specialty credit, -1.4% (-1%); international equities, -2% (-4.7%); opportunistic/absolute return -4.2% (0.9%); and real return, -9.2% (-9.2%). Private equity lags behind a quarter.

As of June 30, the pension funds' actual allocation was 20.1% core fixed income; 19.1% domestic equities; 19% international equities; 16.1% high yield/specialty credit; 8.3% private equity; 5.8% real return; 4.5% real estate; 4% opportunistic/absolute return; and 3.1% cash.