Consultant says Chester County retirement fund outpaced actuarial target; $16 million Walter Scott holding redeemed
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Summary
Board presenter Bill said the Chester County retirement fund ended 2025 with a market value of $606.7 million — roughly $14 million above a 7% actuarial trajectory — and described recent portfolio moves including redeeming roughly $16 million from Walter Scott and reinvesting into a Vanguard fund.
Bill, the board’s presenter, told the Chester County Retirement Board on Feb. 23 that the county’s retirement portfolio finished the year ahead of its long‑term actuarial target. "At the end of 2025, you're ahead of your 7% actuarial rate," he said, adding the fund’s market value was $606,700,000 and that the position was "about $14,000,000 ahead" of where it would have been at a constant 7% return.
The presenter ran through macro factors affecting markets, citing AI‑related demand for memory chips and ongoing uncertainty about future interest‑rate policy. He reported reported performance figures: "For the quarter, 1.5%, 1.4% net of fees;" for 2025, "13%, 12.7% net of fees;" and a 10‑year net return of "8.1% net of fees." He also noted headlines about the Federal Open Markets Committee and incoming leadership could influence near‑term rate expectations.
On portfolio activity, investment staff said they completed redemption of roughly 16,000,000 in Walter Scott exposure in the second week of January and reinvested the proceeds into a Vanguard fund. Staff also reported redeeming $4.5 million from a large‑cap growth sleeve and reallocating that amount to real estate. The presenter said these moves addressed liquidity concerns and rebalanced certain growth exposures. The transcript records the Walter Scott amount as "about 16,000,000" and the large‑cap shift as "$4.5 million." The transcript also lists a figure of "189 in net withdrawals" in the quarter; the unit for that number is not specified in the meeting record and could not be verified from the transcript.
Board members asked about Banner Ridge's reported underperformance on a particular page; the presenter explained that private‑equity reporting timelines and differing benchmarks (time‑weighted vs. money‑weighted/IRR) can produce apparent discrepancies and said the manager’s since‑inception IRR is 17.9%. Investment staff pointed participants to the net IRR table in the packet (page 104) for detailed cash‑flow information.
No formal action or vote was taken on the performance presentation itself; the board proceeded to public comment and then adjourned to executive session. The board confirmed the advertised 2026 meeting schedule earlier in the session.