Andover (Mass.) Contributory Retirement System hired Federated Hermes to run a $15 million cash management portfolio, said Elena M. Kothman, executive director of retirement services, in an email.
The $340 million pension fund issued an RFP in October after the creation of a new 5% target allocation to cash/short-term fixed income to park the proceeds of a pension obligation bond issued in 2021, Ms. Kothman said.
"Keeping 5% in cash gives us a decent interest rate on the remaining funds left from the POB (that weren't invested)," Ms. Kothman said.
Ms. Kothman did not provide further information on a funding source. According to an updated investment report, 85% of the pension fund's assets are invested in the $91.9 billion Massachusetts Pension Reserves Investment Trust, Boston.
Investment consultant Dahab Associates assisted.