Ohio Pension Sacks Money Managers

May 6, 2003 (PLANSPONSOR.com) - The $50-billion Ohio Public Employees Retirement System (OPERS) has given the pink slip to two of its international stock managers, citing poor performance and organizational changes at the companies.

Nicholas-Applegate, who in October announced plans to eliminate 15% of its staff and close its global technology fund, was terminated by PERS, bringing to an end the firm’s management of a $300-million portfolio of large international stocks and a $21-million fund of small international equities.   The firm, a unit of Allianz AG, was placed on the Ohio pension’s “watch list” in October for poor performance, according to a report by Bloomberg News.

With the move, the money formerly under Nicholas-Appelgate’s control will be shifted to existing unspecified managers. The pension currently has 18 international equity managers.

Driehaus’ termination shifted the $230 million in an international stock fund being managed by the firm to JPMorgan Fleming Asset Management.   OPERS cited recent organization changes – earlier this year, Driehaus named three new managers to its International Growth fund to replace the fund’s founder – and poor performance as reasons for the dismissal.

Also announced by the pension fund was the hiring of Callan Associates as an investment consultant for the state’s new member-directed plan and combined plan.   The new plan will enable employees to choose investments, similar to a 401(k) plan.