The governing board of the New York State Teachers' Retirement System, Albany, authorized an initial investment of $400 million for a manager of passive equity international equity and has renewed a series of investment manager contracts ranging from equity and fixed income to real estate investment trusts.
The board authorized the $400 million contract to RhumbLine Advisers to manage part of the pension system's international equity assets benchmarked to the MSCI ACWI ex-U.S. index. The board could invest up to $1 billion with RhumbLine, according to information posted on the $126.6 billion pension system's website.
The board endorsed this transaction and others at its quarterly meeting Thursday.
The board also announced the hiring of Callan as the system's general investment consultant. The incumbent has been Aon Hewitt Investment Consulting, which held the job for 10 years, John Cardillo, a pension system spokesman, wrote in an email. The board issued an RFP in April. Aon Hewitt was a finalist, Mr. Cardillo wrote.
Aon Hewitt "will continue to provide board self-assessment services, as Callan does not offer this service," he wrote. There wasn't a separate RFP, he said.
The board also approved one-year renewals for the following:
- Cohen & Steers Capital Management, which manages $1.6 billion in real estate investment trusts and real estate operating companies.
- Arrowstreet Capital, which manages $1 billion as a global equity manager benchmarked to the MSCI ACWI index.
- Iridian Asset Management, which manages $871.5 million as an active manager of U.S. midcap equities.
- Arrowstreet Capital, which manages $673.4 million as an international equity manager benchmarked to the MSCI ACWI ex-U.S. index.
- BlackRock, which manages $646.1million in commercial mortgage-backed securities.
- FIS Group, which manages $282.3 million as an international equity manager benchmarked to the MSCI ACWI ex-U.S. index
- Ariel Investments, which manages $277.5 million as an international equity manager benchmarked to the MSCI ACWI ex-U.S. index.
- J.P. Morgan Investment Management, which manages $109.8 million as an active manager of U.S. high-yield bonds benchmarked to the ICE BofAML BB-B U.S. High Yield Constrained index.
- Columbia Management Investment Adviser, which manages $83.7 million as an active manager of U.S. high-yield bonds benchmarked to the ICE BofAML BB-B U.S. High Yield Constrained index.
The board also reported that the pension system posted an investment return, net of fees, of 0.9% for the three months ended Sept. 30, the first quarter of the pension system's current fiscal year. The pension system's return for the same quarter in the previous fiscal year was 3.3%.