Philadelphia Pension Board Appoints Interim CIO

Philadelphia

The chief investment officer of Philadelphia’s Board of Pensions, Sumit Handa, announced his plans to resign earlier this month.

He officially left the post on January 15.

Now, the Board has appointed an interim CIO to take Handa’s place while a search for a long-term CIO plays out.

From Philly.com:

Francis Bielli, executive director of the Philadelphia Board of Pensions and Retirement, will be serving as the board’s interim chief investment officer, while the board conducts a search for a new CIO.

The board asked Bielli to put on a second hat, following Sumit Handa’s recent resignation. Handa, who was hired in 2011 to manage the investments of the underfunded $5 billion Philadelphia city workers’ retirement plan, is going back to the private sector, said Rob Dubow, pension board chairman and city finance director.

Bielli’s salary will get a $35,000 bump, totaling $204,000, to fill in the second job, the board announced at its meeting Thursday. A national search will be conducted to find a replacement for Handa.

Bielli will oversee the management of $4.7 billion in pension assets.

 

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Japan Pension CIO Gets 60 Percent Pay Raise

Japan

Japan’s Government Pension Investment Fund (GPIF) has already indicated they will increase salaries for their money managers in a bid to attract more talent.

But the fund’s chief investment officer is getting a raise, as well. Hiromichi Mizuno, the fund’s CIO, will get a 64 percent pay bump this year.

The GPIF hopes the gesture will demonstrate their willingness to shell out cash for talent.

From Bloomberg:

Japan’s Government Pension Investment Fund will increase total annual compensation of its president to about 31 million yen ($260,000), including salary, bonuses and allowances, according to calculations by Shinichiro Mori, a director at the fund’s planning section. That compares with 18.9 million yen previously slated for the year ending March 31, Mori said by phone. The pay increase is effective this month, he said.

Boosting pay may help the pension fund hire more money managers from the private sector as it shifts more of its $1.1 trillion from bonds to riskier assets. Even after the increase, the GPIF’s top official will be paid almost 40 percent less than the chief executive officer at the California Public Employees’ Retirement System, the largest U.S. public pension.

“Compared with global standards and given the responsibility as the top asset manager, the amount still isn’t that big,” said Tetsuya Sakabe, managing director at recruitment adviser Kanae Associates Ltd. in Tokyo. “But it’s positive to see that they’ve improved the compensation structure and the amount is reasonable enough to avoid incurring criticism from the public.”

[…]

GPIF won flexibility from the health ministry last March to pay higher salaries.

“GPIF decided the president’s new pay standard after a comprehensive review taking into account consistency with other public organizations,” including the central bank, Mori said in the phone interview on Jan. 6. For the CIO, “we took into account the trend at private financial firms in order to secure highly professional human resources, without exceeding the pay level for the president.”

The GPIF manages $1.1 trillion in assets and is the largest pension fund in the world.

 

Photo by Ville Miettinen

Chicago Police Pension Begins Search For CIO

binoculars

The Chicago Policemen’s Annuity & Benefit Fund has begun its search for a chief investment officer, according to a job posting and reporting by Pensions & Investments.

The job listing can be seen here.

More details from Pensions & Investments:

Chicago Policemen’s Annuity & Benefit Fund is searching for a chief investment officer, said acting CIO James Maloney, in an e-mail.

Mr. Maloney, chairman of the $4 billion pension fund’s investment committee, was appointed acting CIO last month following the departure of Samuel Kunz. Mr. Kunz joined the University of California, Oakland, in the new position of managing director, asset allocation and investment strategy.

[…]

The deadline for applications is Feb. 16. A hiring decision is anticipated this spring, Mr. Maloney wrote.

The CIO of the Chicago Policemen’s Annuity & Benefit Fund oversees a $4 billion portfolio.

 

Photo by Santiago Medem via Flickr CC

Chairman Appointed to Lead Netherlands’ Largest Pension

Netherlands

A new chairman has been appointed to the board of trustees for one of the largest pension funds in the world, the Dutch pension fund ABP.

The move follows the appointment earlier this year of a new chief investment officer.

From ai-cio.com:

The largest Dutch pension fund has appointed influential European politician Corien Wortmann-Kool as its new chair of trustees, capping off a year of staff changes.

Wortmann-Kool replaces Henk Brouwer who stepped down as chairman of ABP in May. She has been a member of the European Parliament since 2004, and was vice-chair of the European People’s Party from 2009 until stepping down as a politician in June this year.

Jose Meijer, vice-chairman of ABP’s board of trustees, said the appointment was “an ideal combination of knowledge and experience”, adding that Wortmann-Kool had “a great deal of knowledge about the financial sector, is an experienced and strong administrator, and also has an extensive network in Brussels and The Hague”.

“Confidence in pension funds has declined over the years,” Wortmann-Kool said. “There are many changes in store in the coming years, which means that uncertainty among participants in relation to pensions could increase. I want to contribute to good and honest communication with our participants about certainties and uncertainties, so that they know what they can and cannot expect from ABP.”

ABP manages $427 million in assets.

Video: CalSTRS CIO Talks Passive Investing and the “Upside Potential” of the Japanese Market

Christopher Ailman, chief investment officer of CalSTRS, sat down with CNBC on Tuesday and talked about the “upside potential” of the Japanese market. He also discusses index investing and when to actively manage investments.

Video: CalPERS CIO Talks Hedge Fund Exit, Market Risk of Climate Change and Corporate Tax Avoidance

http://youtu.be/jRDuJt_jJqQ?list=UUWHcVDsYvL_xcRjarkRlqoQ

The above video features an interview with CalPERS chief investment officer Ted Eliopoulos. Topics include CalPERS’ hedge fund exit, the fund’s stance on corporate tax avoidance, and how climate change has impacted the fund’s portfolio.

Ai-CIO.com summarizes a few key points from the interview. On hedge funds:

“One of our prime considerations in reviewing the program is whether we believe we could scale the program to a much more significant part of the overall portfolio,” he said. “Our analysis, after very careful review, was that mainly because of the complexity of the hedge fund portfolio and the cost we weren’t comfortable scaling the program to a much greater size than it currently held.”

On corporate tax inversion:

Eliopoulos emphasised that, in general, tax was something to be addressed by relevant governments as a policy issue, but expressed concern about corporate inversions.
“We think the best approach is for the US government to address this type of a loophole in the context of overall corporate tax reform, and we’ve urged the government to get at it,” he said.

Video: CalSTRS CIO Talks Long Term Investing And Handling Market Volatility

[iframe src=”<iframe src=”http://player.theplatform.com/p/2E2eJC/nbcNewsOffsite?guid=c_closingbell_calstrsamp_141024″ width=”635″ height=”500″ scrolling=”no” frameborder=”0″></iframe>”]

 

Chris Ailman, CIO of the California State Teacher’s Retirement System, sat down with CNBC last week to talk about handling market volatility, re-balancing the fund’s portfolio and being a long-term investor.

Ailman also talks about why CalSTRS invests in hedge funds and why that won’t be changing any time soon.

Video credit: CNBC

Video: California CIO On Why He Thinks Divesting From Hedge Funds Doesn’t Make Sense

The above video features Sean Bill, CIO of Santa Clara Valley Transportation Authority and trustee for the City of San Jose. During the interview, he touches on CalPERS’ hedge fund exit, why he thinks the move was “political”, and the difficult of handling investments in-house.

 

Video from Chief Investment Officer magazine.

San Diego Fund Trustee May Have Breached Code of Ethics While Lobbying For CIO

board room

The San Diego County Employees Retirement Association (SDCERA) board voted last week to retain its controversial chief investment officer, Lee Partridge, and his firm, Salient Partners.

The vote was 5 to 4, and trustees on both sides of the vote were adamant about their position.

But did one trustee go to0 far while lobbying to keep Partridge? Board Vice Chairman David Myers may have breached a code of ethics when he sent emails to his subordinates asking that they vouch for Partridge. From the San Diego Union Times:

Before the county pension board met last week and decided to keep its Texas consultant in charge of investments, Vice Chairman David Myers urged retired employees to email the agency to voice support for Lee Partridge and Salient Partners.

Myers’ request also was sent to current workers, including his own subordinates at the Sheriff’s Department. The communications raise the question of whether Myers put undue pressure on rank-and-file employees to send emails on a political matter.

Two weeks ago, when U-T Watchdog asked Myers whether it was appropriate for a senior commander to make such requests of subordinate employees, he declined to respond.

The San Diego County Employees Retirement Association responded on Myers’ behalf, saying he only contacted retirees — not the hundreds of deputies that serve beneath him.

But in emails since obtained under the California Public Records Act, Myers states that he included his own subordinates in his effort to retain Partridge’s services, sending them a three-page letter in support of Partridge’s contract and asking them to advocate for it.

“I sent to all law enforcement members, active and retired,” Myers wrote to pension system CEO Brian White on Sept. 24, adding that all 40 responses he received were positive. “I am asking them to also communicate that message via email to SDCERA.”

There may be further emails from Myers to employees on the subject. The county has delayed release of five additional emails pending input from the pension system.

Those actions could be in breach of the SDCERA Code of Ethics, according to U-T San Diego:

The SDCERA Code of Ethics says trustees must remain objective and says “misuse of influence” is unacceptable. The code does not specify what types of misused influence are at issue, and agency officials declined to discuss Myers’ actions.

Jan Caldwell, a spokeswoman for the Sheriff’s Department, said there is no issue with Myers’ communications with front-line staff.

“The San Diego County Sheriffs’ Department does not have a policy or procedure that would preclude an employee representative of the County’s Retirement Association from communicating to county employees on matters of interest to county employees relating to their retirement system,” she said.

Bruce Cain, a political-science professor at Stanford University, questioned the wisdom of a higher-up asking subordinates to become activists in any cause.

“Typically you don’t want senior people engaging in this kind of thing because it could be perceived as pressure,” Cain said.

Max Neiman, senior research fellow at the Institute of Governmental Studies at the University of California, Berkeley, agreed, saying, “I would find that unseemly, if not a violation of ethics or the law.”

SDCERA spokesmen have maintained that Myers didn’t violate any ethics codes.

Maryland Fund Looking For New CIO

board room chair

The Maryland State Retirement and Pension System is looking to hire an executive search firm to hire the fund’s next chief investment officer.

The fund has put the Request for Proposal on their website. The document can also be found at the bottom of this post. According to Pensions & Investments, the proposals are due by September 22 at 2 pm Eastern Time.

The fund’s previous CIO, Melissa Moye, left the fund recently to work for the US Treasury Department. Pensions & Investments reported at the time:

[Moye] is leaving at the end of August to become a senior policy adviser with the U.S. Treasury Department’s office of state and local finance. Deputy CIO Robert Burd will serve as acting CIO. The board has not begun the search process yet, spokesman Michael Golden said.

At the Treasury Department, Ms. Moye will focus on public sector pensions for the office, which was created in May to coordinate efforts to oversee developments in state and local financial markets, including public pension fund liabilities. Maryland pension board chairwoman and state Treasurer Nancy Kopp said in a statement that while the board will miss Ms. Moye’s leadership, “we are thrilled with the opportunity Dr. Moye will have to apply her wealth of knowledge and experience at the national policy level.”

Ms. Moye became CIO in September 2011 after serving as acting CIO since October 2010. Before that, she was deputy treasurer for financial policy and a trustee of the state pension system. Mr. Burd started with the retirement agency in 2001 as an assistant director of externally managed investments and was named managing director of private markets in 2008.

The RFP:

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