Torrington trustees approve removing Brandywine global bond strategy from pension investment policy

Trustees for Torrington’s Police and Firemen’s Pension Fund and the City Employees’ Retirement Fund voted June 17 to remove the Brandywine global bond strategy from the funds’ investment programs and repurpose the allocation within fixed income. The recommendation came from the funds’ investment adviser during a quarterly review of the investment policy statements.

Adviser presentation and recommendation

An investment adviser for the funds summarized first-quarter market performance and said both plans’ investment policy statements are in “good working order” but recommended a single portfolio change: eliminate the Brandywine global bond strategy and redeploy that capital elsewhere in fixed income. The adviser said research suggested Brandywine’s strategy—which has flexibility to invest broadly overseas—carries relatively higher volatility for the allocation size and that the city’s fixed-income exposure could be “repatriated” into less-volatile instruments.

Why it matters

The change affects the two funds’ target allocation tables and will be reflected in the next version of each plan’s investment policy statement. Trustees were told the proposed target allocations would be very similar to the current ones, and the adviser framed the move as portfolio repositioning rather than a wholesale strategy shift. The presentation emphasized diversification and long-term return targets; the adviser noted five‑year annualized returns for the plans of roughly 9.5% and compared that to the actuarial return target of about 6.75%.

Trustees’ action and votes

The board of trustees for the Police and Firemen’s Pension Fund approved the adviser’s recommendation to eliminate the Brandywine strategy and rebalance the portfolio as presented. A motion to approve was made and seconded; the mayor called the vote and the motion carried (voice vote). The trustees for the City Employees’ Retirement Fund approved the same change in a separate motion; the motion was made and seconded and carried (voice vote).

What the boards said and next steps

Trustees asked a few questions focused on risk and portfolio testing. One trustee asked whether redirecting the allocation represented a more risk-averse stance; the adviser replied the change reflected research showing Brandywine’s strategy invests in some higher-volatility overseas markets and that “we don't need to take that risk with that portion of the program.” Trustees requested the change be reflected in the written investment policy statements and allocation grid. Staff indicated the allocation-table revisions would be incorporated into the IPS documents.

Votes and procedural notes

Each pension board took a separate, recorded motion to adopt the portfolio change; both motions carried. Staff and counsel will update the pension plans’ written investment policy statements to reflect the approved allocation changes.

Ending

Trustees received additional manager- and market-level updates during the meeting; the adviser said no other immediate changes were recommended. Any material document updates will be presented at a future meeting as amended IPS text.