CalPERS' estimated funded status was about 72% as of June 30, rising from 70.9% last year but still reflecting a significant decline from 81.2% in 2021, according to $446.7 billion pension fund's most recent funding report.
The material drop in funded status in fiscal year 2022 was the result of the fund's investment return of -7.5% for that fiscal year, the report said.
With the slightly lower-than-expected investment return for fiscal year 2023, the funded status of the system increased as a result of employers making their unfunded accrued liability payments, the report said.
The California Public Employees' Retirement System earned a net return of 5.8% for the fiscal year ended June 30, according to the fiscal year 2023 Basic Financial Statements approved on Nov. 15 by the CalPERS board. CalPERS announced its preliminary 2023 fiscal year returns in July.
The system has a 6.8% expected rate of return.
Separately, the Sacramento-based fund changed its insider-trading policy to allow stock trading by public equity staffers when the private markets team has information on a public company through, for example, a take-private transaction.
CalPERS is erecting physical and technological barriers around the private market investment teams to prevent any transfer of information, Amy Deming, an investment director, told the investment committee on Nov. 13.
The new policy reduces risk because the framework ensures that information is tightly safeguarded and therefore there is less risk for the entire organization, Deming said.
