SUBJECT/RECOMMENDATION:
Title
Approve the termination of fixed income money manager Western Asset Management Co. and authorize the appropriate officials to execute same.
Body
SUMMARY:
Western Asset was hired as a large cap growth equity manager for the plan in October 2004. As of December 31, 2024, the market value of the plan’s investment in Western Asset’s fixed income product totaled $159.1 million, or 11.8% of the Plan’s total investment portfolio.
Western Asset’s performance has declined in recent years, as detailed below. Additionally, the product has experienced significant client redemptions in recent months related to the recent indictment of Western Asset’s co-CIO by a federal grand jury on fraud charges.
The Pension Investment Committee unanimously recommended termination at their November 22, 2024, quarterly committee meeting.
Performance versus benchmark index:
Calendar 2024 Last 3 years Last 5 years
Net of fees return 0.88% -3.69% -0.81%
Benchmark index 1.25% -2.41% -0.33%