Alaska Retirement Management Board, Juneau, hired Legal & General Investment Management America to run $193 million in scientific beta international equities, said Stephanie Alexander, liaison officer, in an email.
The hiring was the result of structural changes within the board's $5 billion international equity portfolio, which were made to simplify the manager structure in terminating active stand-alone emerging markets equity and small-cap equity managers, and reduce the number active managers in other strategies to control fees and specific manager risk.
Managers terminated as a result of the changes, and their sizes and types of portfolios as of Aug. 30 were:
- Lazard Asset Management, which ran $325 million in active international developed markets equities and $229 million in active emerging markets equities.
- McKinley Capital Management, which ran $285 million in active international developed markets equities.
- DePrince Race & Zollo, which managed $269 million in active emerging markets equities.
- Mondrian Investment Partners, which ran $134 million in active international small-cap equities.
- Schroders, which ran $129 million in active international small-cap equities.
- Assets from the termination will fund the new scientific beta portfolio managed by LGIMA, with the remaining assets added to existing international equity managers. Ms. Alexander said the exact distribution of assets to individual portfolios has yet to be determined. She said staff plans to allocate 50% of the international equity portfolio into passive strategies, 30% into active strategies and 20% into factor-based strategies.
The existing managers and the sizes and types of portfolios as of Aug. 30, are:
- State Street Global Advisors, $972 million, passive international developed markets equities.
- Brandes Investment Partners, $698 million, active international developed markets equities.
- Capital Group, $391 million, active international developed markets equities.
- Arrowstreet Partners, $375 million, active international developed markets equities.
- Baillie Gifford, $330 million, active international developed markets equities.
- BlackRock, $321 million, passive international developed markets equities.
- The board oversees the management of $33.9 billion in state retirement plan and other assets, including the $17.4 billion Public Employees' Retirement System and $8.6 billion Teachers' Retirement System.
Separately, the board appointed Ruth Ryerson to a three-year term as a member of the board's three-member investment advisory council. Ms. Ryerson retired as executive director of the $8 billion Wyoming Retirement System, Cheyenne, on July 31.
Finally, the board approved terminating BlackRock as the S&P 500 index fund manager in the investment options lineup of the state's $990 million Deferred Compensation Plan, which the board oversees. As of July 31, the BlackRock fund had $221 million in assets in the plan.
The board approved hiring SSGA to run an S&P 500 index fund in the investment options lineup of the deferred compensation plan, as well as the state's $4.1 billion Supplemental Annuity Plan, Alaska Public Employees' Retirement System's $1.8 billion DC plan and the Teachers' Retirement System's $695 million DC plan.
The reason for those changes was not provided.