The performance of New York City's five public pension plans was positive in the third quarter, the chief investment officer of the funds told trustees at Wednesday's common investment meeting held at the Dinkins Municipal Building in Manhattan.
In the third quarter, the five pension funds turned in a steady financial performance, according to Scott Evans, Deputy Comptroller for Asset Management.
"The third quarter was a benign quarter in terms of risk," Evans said. "Risky assets were beginning to run north. We can see that in the results of our five systems."
The city's five main pension funds are the New York City Employees' Retirement System (NYCERS); the Teachers' Retirement System of the City of New York (TRS); the New York City Police Pension Fund Subchapter 2; New York City Fire Department Pension Fund Subchapter Two; and the New York City Board of Education Retirement System (BERS).
Third quarter pension performance saw a median fund return of 3.5% with a median return of 1.3% for Fiscal 2016 year to date, as rated under the Wilshire Trust Universe Comparison (TUCS), which measures performance of actively managed pension funds.
The performance was better than the median fund return of 1.8% in the second quarter as rated under TUCS, but the same as the previous year-to-date median return.
BERS has return of 4.7% a third-quarter and 0.4% year to date.; TRS returned 3.8% in the quarter and 1.9% year to date; Police saw a third-quarter return of 1.4% and a year to date return of 0.4%; Fire had a quarterly return of 3.9% and a year-to-date return of 1.7%; and NYCERS posted a 3.8% third-quarter and a year-to-date return of 1.8%.
City Comptroller Scott Stringer is the custodian of the public pension funds, whose value is estimated at about $160 billion. Since he was elected in 2013, he has overhauled the administration of the system. In late 2015, he instituted the common investment meeting, which streamlined the boards' operations and consolidated 54 monthly investment meetings of the individual boards into six meetings of all trustees per year.
The Bureau of Asset Management assists the funds in picking investment advisors and consultants, though investment policies are adopted by each of the five pension funds' boards of trustees. And each of the boards establishes its own asset allocation policy and investment objectives. The funds invest in a variety of asset classes as well as making economically targeted investments.
The city's general obligation bonds are rated Aa2 by Moody's Investors Service and AA by S&P Global Ratings and Fitch Ratings.
The last Common Investment Meeting of the year was attended by a group of peaceful protesters who urged the city to fully divest its pension funds from the fossil fuel industry.
