OAK BROOK, Ill. – On Thursday, the Illinois Municipal Retirement Fund (IMRF) shared several updates and the Board of Trustees approved multiple investment recommendations during a special meeting.
Minority & Emerging Manager Utilization
Highlights from 2017 include:
-
Minority investment managers manage $7.56 billion on behalf of IMRF, a 7.4 percent increase from last year.
-
Minority investment managers represent 18.4 percent of the total Fund’s market value and 26.7 percent of IMRF’s actively managed assets (excluding index investments).
-
IMRF has direct relationships with minority and emerging investment managers in all asset classes with the exception of timberland and agriculture.
-
IMRF utilizes manager of managers/fund of funds to invest in minority and emerging investment managers in International Equity, Fixed Income, Real Estate, and Private Equity asset classes.
-
IMRF increased its goals for assets managed by Minority investment managers in the Real Estate and Private Equity asset classes to 8% and 15%, respectively.
Minority Broker-Dealer Utilization
Highlights from 2017 include:
Overall
- IMRF exceeded its minority brokerage goals by asset class
- IMRF’s investment managers traded with 32 minority broker/dealers
- IMRF increased its minority brokerage goals for the U.S. Micro-Cap Equity asset class to 10%
- IMRF created a new asset class goal for Global Listed Infrastructure of 20%
Equity
-
The IMRF portfolio generated over $10.8 million in Equity commissions
-
Minority broker/dealers earned $2.9 million or 27.42 percent of total Equity commissions
Fixed Income
- The IMRF portfolio traded over $91.8 billion Par Value
- Minority broker/dealers earned $2.9 million or 27.42 percent of total Equity commissions
2017 Annual Securities Lending Activity Report
- IMRF generated $9.8 million in securities lending income across separate accounts
-
IMRF’s total securities lending income, including passive index funds, amounted to $13.0 million
-
Both IMRF and Northern Trust actively monitor the program via established protocols & processes
-
Prudent reinvestment of cash collateral in high quality, liquid, short duration paper at a yield premium to Effective Fed Funds Rate
Investment Policy
The Board approved several recommendations for updates, based on the 2018 Statement of Investment Policy Review, including:
- Changing the word “female” to “women” to comply Illinois Pension Code updates
- Changing the word “handicap” to “disability” to comply Illinois Pension Code updates
- Revising language to confirm that the Total Fund Benchmark is equal to the sum of:
- 37% - Russell 3000 Index
- 28% - Bloomberg Barclays U.S. Aggregate Bond Index
- 18% - Morgan Stanley Capital International All Country World Index ex-US
- 9% - National Council of Real Estate Investment Fiduciaries Open-End Diversified Core Index
- 7% of the 9% Annual Alternatives Benchmark
- 1% - 3-month Treasury Bills
- Adding a section that addresses stock distributions
- Outlining required documentation from Public Market Investment Managers and Consultants
- The full charter and policy are available in the Investments section online at imrf.org.
Asset Allocations
-
Reduced exposure to U.S. Equity asset class from 38% to 37%
-
Increased exposure to International Equity asset class from 16% to 18%
-
Reduced exposure to Fixed Income asset class from 29% to 28%
-
Increased exposure to Real Estate asset class from 8% to 9%
-
Reduced exposure to Alternative Investments asset class from 8% to 7%
As of December 31, 2017, the IMRF total portfolio was valued at $41.3 billion.
###