Fund’s pension portfolio down to $261M

The NMI Retirement Fund board of trustees disclosed Friday that based on its unaudited financial report, the estimated value of its portfolio is only $261.2 million as of Nov. 30 this year, a slight decline from what was reported two months ago.

Fund administrator Richard Villagomez reported in Friday’s regular board meeting that a slight negative return was recorded in November at -0.46 percent. In September, Fund portfolio was valued at $266.4 million but due to continuous drawdown from the investment fund and a slight negative return, this resulted in the assets’ continued decline.

Villagomez described November as an extremely difficult period for the agency because it has been dealing with a lot of issues. The biggest among these was the transition into CDARS program, or the certificate of deposit account registry service.

“November was extremely difficult month because we’re trying to do many things and the biggest thing we’re doing is the transitioning into CDARS program and to the Glidepath 2013 modified asset allocation simultaneously,” he said.

The Fund, he said, also withdrew $4 million in November to pay for the pension benefits of members.

As of Nov. 30, he said that $55 million—or 21 percent of its portfolio—has already been transferred to the CDARS program.

Since the departure of investment consultant Wilshire Associates in September, the board decided to liquidate all its investments and moved them to CDARS. The liquidation aims to adapt to Glidepath 2013 which the Fund described as conservative transitional portfolio.

Villagomez provided the board the breakdown of the $261.2 million portfolio and where are they being invested at present. He said the Fund has total cash and cash equivalent of $22 million; international equities, $576,745; fixed income (Vanguard and PIMCO), $182 million; alternative investment at JP Morgan, $1.6 million; and total bonds and cash/cash equivalent at CDARS, $55 million.

The administrator pointed out that the $1.6 million at JP Morgan is still part of the original $20 million investment that the board started liquidating since last year. Data shows that of the $261.2 million, a bulk of the portfolio is invested at fixed income which is about 70 percent.

According to Fund board chair Sixto Igisomar, it is still the intention of the board to move all its portfolio to CDARS until a new investment consultant is found. However, he admitted that the movement to the program may take a while because amount of cash/cash equivalent that is authorized to be transferred varies from time to time.