Asset Allocation, Asset Managers, Defined Benefit, Institutional Investors, Pension Funds, Public Funds

Virginia Says Hello, Goodbye to Managers to Tune of $1.4B

The Virginia Retirement System (VRS) in Richmond has since February terminated asset managers handling accounts within its credit-strategies program, and committed assets to two new managers, amounting to $1.4 billion in transactions. The hires and fires we reported to the fund’s board at its May 13 meeting.

“The hiring and terminations presented…were not related to each other. It just happens that they were presented during the same [board] meeting. The terminations resulted because the managers no longer supported the portfolio objectives,” according to an email from a VRS spokeswoman in response to questions from IA

The $79.2 billion fund (the 19th largest public or private pension fund in the U.S.) terminated Oaktree Domestic Convertibles from a $467 million convertible bonds account and relieved The fund engaged Jackson Square Partners for a $350 million U.S. small-cap growth account, and KKR’sReal Estate Credit Opportunity Partners Fund II for a $150 million mandate to invest in junior bonds and in B-piece securities of commercial mortgage-backed securities, VRS confirmed. No consultants participated in the transactions.

As of March 31, VRS was allocated approximately 40.2% to public equity; 15.9% to fixed income; 14.3% to credit strategies; 13.7% to real assets; 11.3% to private equity; 2.7% to MAPS (Multi-Asset Public Strategies); 1.2% to PIP (Private Investment Partnerships); and 0.5% to cash.

VRS was 76.3% funded as of the close of 2018.  

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