Government Retirement Plans See Investment Increase in Q4 2011

According to the Quarterly Summary of the Finances of Selected State and Local Government Employee Retirement Systems released by the U.S. Census Bureau, this increase came after having a decrease in third quarter 2011.

Total holdings and investments went up 3.2% from last quarter to $2.6 trillion. However, there was a year-to-year decrease of 1.1% from $2.6 trillion in the fourth quarter of 2010, breaking the continuous trend of year-to-year increases after eight consecutive quarters. Earnings on investments totaled $97.1 billion, showing gains after last quarter’s losses of $198.8 billion. Compared with the same quarter one year ago, earnings on investments were down 28.5%.

Corporate Stocks 

Holdings of corporate stocks quarter-to-quarter increased 7% to $822.4 billion in the fourth quarter of 2011, up after two consecutive quarters of declines. Corporate stocks year-to-year were down 7% from $884.4 billion in the fourth quarter of 2010. Corporate stocks comprised less than a third (31.5%) of the total cash and security holdings of major public employee retirement systems for the current quarter.

Corporate Bonds  

Corporate bonds quarter-to-quarter remained flat at $399.6 billion in the fourth quarter of 2011, after two consecutive quarters of declines. Corporate bonds year-to-year decreased 7.8% from $433.7 billion in the fourth quarter 2010. Corporate bonds comprised just under a sixth (15.3%) of the total cash and security holdings of major public employee retirement systems for the current quarter.

International Securities  

International securities quarter-to-quarter increased 5.4% to $472.8 billion in the fourth quarter of 2011, after having decreased last quarter by 14.3%. International securities year-to-year decreased 5.6% from $500.9 billion in the fourth quarter of 2010. This was the second consecutive quarter of year-to-year decreases. International securities comprised more than a sixth (18.1%) of the total cash and security holdings of major public employee retirement systems for the current quarter.

Federal Government Securities
Federal government securities quarter-to-quarter increased 0.7% to $178.8 billion in the fourth quarter of 2011 and year-to-year increased 5.4% from $169.6 billion in the fourth quarter of 2010. This was the ninth consecutive quarter with a year-to-year increase. Federal government securities comprised 6.8% of the total cash and security holdings for the current quarter.

Total Contributions and Payments  

Employee contributions quarter-to-quarter increased 27% to $9.2 billion and year-to-year decreased 3.2% from $9.5 billion in the fourth quarter of 2010. Government contributions quarter-to-quarter increased 19.3% to $21.5 billion and year-to-year decreased 4% from $22.4 billion in the fourth quarter of 2010. Total payments quarter-to-quarter decreased 3.4% to $50.2 billion and year-to-year increased 0.1% from the fourth quarter of 2010.