June 22, 2012
FOR IMMEDIATE RELEASE
Treasurer Cowell Reports First Quarter Pension Fund Returns
Fund returns 6.38 percent, sees positive returns across all portfolios
RALEIGH – State Treasurer Janet Cowell reported today that the North Carolina pension fund returned 6.38 percent for the first quarter of 2012 and 5.15 percent for the year ended March 31. Pension fund assets were valued at $75.9 billion at the end of the first quarter, an increase from the $71.8 billion reported at the end of the calendar year.
“Much of the fluctuation we are seeing in our returns is due to continued volatility in the stock market,” stated Cowell. “We can expect this trend to continue, especially considering the ongoing instability in Europe and the fact that this is an election year.”
The pension fund saw gains across all portfolios, with the public equity (stock) portfolio rising 13.02 percent for the first quarter and 0.28 percent for the year. Equity markets grew more confident in the first quarter due to improved economic activity in the United States and reduced fears about sovereign debt. This forward momentum has slowed in subsequent weeks, however, due to a modest decline in employment and increasing unrest in Europe.
The increase in bond rates had a negative impact on Treasury prices that resulted in modest fixed income returns of 0.48 percent for the quarter. The portfolio returned 10.65 percent over the last year. With global risks beginning to elevate, Treasury markets may experience another downturn.
Real estate saw gains of 3.4 percent for the quarter and 10.66 percent for the year. The alternatives portfolio, composed mostly of private equity, returned 2.1 percent for the quarter and 7.92 percent for the year.
The credit portfolio gained 3.7 percent over the quarter and 0.28 percent over the past year. Inflation made a strong comeback for the quarter, returning 3.15 percent. The portfolio experienced a decline of 8.61 percent for the year.
View the First Quarter Performance Report
The North Carolina Retirement Systems, the formal name for the pension fund, is now the eleventh largest public pension fund in the country. It provides retirement benefits and savings for more than 850,000 North Carolinians, including teachers, state employees, firefighters, police officers, and other public workers. For more information, visit www.nctreasurer.com.