Illinois Municipal Retirement Fund, Oak Brook, terminated Genesis Investment Management from a $650 million active emerging markets equity portfolio, citing deteriorating conditions at the firm, including the loss of client assets, personnel turnover and performance concerns.
The $48.9 billion pension fund's board approved the action at its Nov. 17 meeting, said spokeswoman Maureen O'Brochta.
The board's approval came after the pension fund's investment committee on Nov. 16 recommended the full liquidation of the manager's portfolio.
Genesis Investment Management is a London-based emerging markets equity shop. Founded in 1989, the firm became an affiliate of Affiliated Managers Group in 2004.
Angela Miller-May, the pension fund's chief investment officer, said at the investment committee meeting that the situation at Genesis Investment Management required staff to email board members and receive approval at that time to begin the liquidation process.
The board last met on Aug. 24, and staff believed it could not wait until the November meeting to begin the process of termination.
IMRF began the liquidation process on Oct. 28 in the first of four tranches.
Also at the Nov. 17 board meeting, Miller-May and investment staff requested delegated authority to move forward with urgent manager terminations in between board meetings.
The request was approved by the board, pending a revision including an emailed notice 48 business hours in advance of the termination to give the board the option to ask questions and/or hold a special board meeting.
Assets from the termination will be reallocated to an existing passive international equity portfolio managed by Northern Trust Asset Management. The previous size of the portfolio was not provided. Both Miller-May and investment consultant Wilshire Advisors, which assisted with the termination, said one of the goals of the coming year is to determine how to permanently reallocate the assets.
Officials at Affiliated Managers Group and Genesis Investment Management could not be immediately reached for comment.
As of Sept. 30, the pension fund's actual allocation to international equities was 18.6%; the target is 18%.
