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Callan summarizes 2024 performance for Norwalk pension funds and outlines 2025 work plan
Summary
Callan, the pension board’s investment consultant, gave a year-end review of the City of Norwalk pension and OPEB portfolios, flagged a few underperforming managers for monitoring, and recommended a 2025 schedule of manager presentations and custodial review work.
Callan, the investment consultant to the City of Norwalk Pension Board, reviewed 2024 performance and presented a proposed work plan for 2025, saying the consultant would continue manager monitoring, run custodial benchmarking if requested, and schedule targeted manager presentations.
Callan told the board it had completed asset-allocation studies for both the pension fund and the city’s OPEB plan, updated the pension investment policy statement (IPS), and performed fee analyses across all plans including the defined-contribution (DC) accounts. Callan said the OPEB IPS will be formally reviewed in 2025.
The consultant recommended several items as priorities for the coming year: inviting the board’s fixed-income managers to present to the board, scheduling an overview presentation by Northern Trust to review custody services and securities‑lending activity, and continuing regular portfolio reviews with the plan actuary. Callan also offered to perform custodial-service benchmarking and fee comparisons if the board wanted a deeper review.
Callan reviewed performance and manager-level results. The report noted total plan assets of about $551,200,000 and said the total fund was up roughly 6.7% for the fiscal year-to-date. Callan reported the board redeemed $9,000,000 from the Russell 1000 index in December to bring U.S. equity exposure back within the IPS target range.
On managers, Callan flagged several specific items for monitoring. Walter Scott, which the board added about two years ago, has underperformed since joining the plan; Callan said the firm has stuck to its style and that Callan retains conviction, but recommended hearing from Walter Scott at a future meeting. Callan described BlackRock’s emerging-markets fund as having lagged largely because of an overweight to China. By contrast, Callan highlighted ABS (a long/short global-equity allocation) as having produced strong intermediate- and long-term performance for the plan.
The board was also informed of private-equity cash flows: a Pantheon fund distributed $217,500 in November, and a separate Fund 7 was expected to distribute about $50,000 in January.
Callan noted other manager-level performance: LSV had recently underperformed over shorter horizons but showed strong longer-term results; Silchester and UBS absolute‑return strategies were described as performing well; TCW and MetWest were noted for mixed returns with a prior duration bet that weighed on some recent periods; and PIMCO’s real‑assets option was mentioned as a diversifying sleeve that had done well over the trailing year.
There were no pension benefit applications for action at the meeting. The board accepted the minutes from the December pension meeting (motion and second recorded), heard the Callan presentation and then recessed or adjourned that portion of the agenda.
The board did not adopt any new investment policy changes or mandate manager terminations during the presentation; Callan’s recommendations were mostly to schedule further presentations, run custodial benchmarking if requested, and continue monitoring managers already on the watch list.
