Los Angeles Water & Power Employees' Retirement Plan hired Capital Group to manage a combined $1.1 billion in an active extended global credit strategy for the retirement system's defined benefit plan and retiree health plan, said Jeremy Wolfson, chief investment officer.
Capital Group will manage about $940 million for the $16.7 billion pension plan and about $166 million for the $2.9 billion health plan, Mr. Wolfson said.
The retirement system issued an RFP in March following approval the previous October for a potential replacement for Macquarie Investment Management, which runs a similar portfolio, due to organizational changes at that firm. The firm did rebid for the services but was not a finalist, Mr. Wolfson said.
The other finalists were Fidelity Institutional Asset Management, Pacific Investment Management Co. and Western Asset Management.
As of July 31, the actual allocations to fixed income in the pension plan and health plan were 21.6% and 21.2%, respectively. The target in both plans is 25%.
Investment consultant RVK assisted.