- New York City’s five pension funds had a combined value of $253.3 billion
- Its 321 pension fund managers earned about $1.7 billion in fiscal 2023
- That’s an increase of about 10 percent from the year before – or about $150 million
Wall Street money managers charged with investing in New York City’s pension funds earned about $1.7 billion in fees last year.
A total of 321 pension fund managers oversaw the pension funds into which police, firefighters, teachers, school district workers and other city employees pay.
As of June 30, the end of the financial year, the combined value is According to figures, the five funds totaled approximately $253 billion quoted by Bloomberg of a annual report filed by the NYC Comptroller’s Office.
The managers achieved an average return of around 8 percent on these funds. However, their fees have increased by almost 10 percent (or $150 million) in the last fiscal year.
The pension gain was also nearly four percent lower than the 11.9 percent benchmark set by the city, which was based on public market index returns.
Wall Street money managers charged with investing in New York City’s pension funds earned $1.7 billion in fees last year
New York City’s firefighter pension fund grew about 8.1 percent from fiscal year 2023. Pictured are FDNY officers entering a hotel residence in March
The total assets of the city’s five funds are still $40.2 billion short of what is needed to cover the benefits promised to employees at retirement.
New York City Comptroller Brad Lander praised the performance of the various pension funds in August.
“Our public sector employees and retirees can be assured that we are well positioned to continue to deliver strong returns over the long term,” he said.
The NYC Comptroller’s Office, through its Bureau of Asset Management, serves as investment advisor to the five funds.
They include the New York City Employees’ Retirement System (NYCERS), Teachers’ Retirement System (TRS), Police Pension Fund (Police), Fire Pension Fund (Fire), and the Board of Education Retirement System (BERS).
The five funds serve nearly 800,000 members and beneficiaries and are independently governed.
According to the Comptroller’s Office 2023 Annual Comprehensive Financial Report, the NYC Pension Fund (NYCPPF) grew approximately 7.8 percent from FY 2023. Photo shows officers outside the city’s 41st District in 2020
As of June 30, 2023, the managers charging the $1.7 billion in fees included: ’24 domestic equity managers, 35 international equity managers, 4 global managers, 19 hedge fund managers, 21 fixed income managers, one Economically Targeted Investment (ETI ) manager, 36 alternative credit managers, 116 private equity managers, 51 private real estate managers and 14 infrastructure managers.’
Bloomberg noted that the city’s five funds were more reliant on money managers making private loans to companies or buying debt in 2023 than in 2022, according to the report.
Private credit has recently produced higher returns than bonds and can be less volatile than public markets.
