South Carolina’s embattled pension fund posted a 12.4 percent gain during the 2012 calendar year, the fund’s managers are reporting. That pushes the value of the portfolio to $26.6 billion – although it remains to be seen how our state’s fund stacks up to other public pension funds around the country.
The Palmetto State’s retirement fund is now back to where it was in June 2011 – and up $1.7 billion from last June.
Is that good? Yes. But the market is up – and everybody is posting gains. The real benchmark here will be in the comparative analysis – and early indications are that South Carolina’s numbers trail both the broader market as well as other large pension funds.
Also, we’ll be curious to find out if these gains are coming from traditional stocks or from the far riskier “alternative” investments that the fund bet so heavily on in recent years. Our bet is this increase stems almost exclusively from surging equities.
Finally, it’s curious to see the S.C. Retirement System Investment Commission (SCRSIC) releasing a mid-year report for the first time ever. Typically these reports come at the end of the state’s fiscal year, which ends on June 30.
“They cherry picked dates and did not mention they were in bottom half of large pension plans,” one investment analyst told FITS.
S.C. Treasurer Curtis Loftis, who has spent the last two years pushing the fund to make smarter investments and reduce its fees, said his office was in the process of reviewing the data and would be issuing a statement soon. Loftis has aggressively criticized the fund’s risky alternative investments as well as the exorbitant fees it has paid to produce substandard returns.