Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Investments topic
No spam. Unsubscribe anytime.
Board hears private-markets report, reduces prefunding discount and confirms new CIO
Summary
Trustees received a private-markets performance update showing strong recent returns, approved a staff recommendation to reduce the prefunding discount to 4.6375%, and voted to appoint Jay Bond as the new Chief Investment Officer with a mid-April start date.
The San Jose Retirement Board spent the meeting’s substantive portion on investment matters, receiving a detailed private-markets and total-fund performance briefing and taking three formal actions: approving a prefunding discount recommendation, confirming the hire of a new chief investment officer and endorsing continued oversight steps.
Investment report: Investment staff presented private-markets results and total-fund performance slides. Key figures cited in the presentation included a one-year total-fund return of about 13.6% and three-year annualized returns of roughly 11.2%. Private-markets distributions from earlier vintages included a roughly $7 million distribution from a middle-market healthcare exit; Series One and Series Two program metrics were discussed (Series One net IRR ~16.6%; Series Two net IRR presented as ~21.6% though Series Two remains early-stage).
Prefunding discount: Staff reviewed the prefunding discount methodology and said three automatic triggers were hit this year (economic conditions, market returns and valuations), prompting a 30% reduction in the previously available discount. Staff recommended offering the City a discount of 4.6375% to purchase plan liabilities; the board moved and approved that recommendation in the meeting. The recommendation was presented as a policy-determined discount rate rather than a directive that the City must prefund; staff noted the City’s sponsor contribution choices remain the sponsor’s option.
New CIO hire: Trustees announced an agreement to appoint Jay Bond as the incoming Chief Investment Officer for Retirement Services, with a proposed start date in mid-April. The board moved to approve the contract/agreement (motion by Santos, second by Schwab in the transcript) and Jay Bond addressed trustees, promising to support staff, protect team independence and focus on fiduciary stewardship.
Why it matters: The investment update contextualized recent strong market returns and private-markets realizations that materially benefited plan assets; the adjusted discount affects the economic terms available to the City if it chooses to prefund obligations; appointing a new CIO is a key governance and operational step for ongoing portfolio management.
What’s next: Staff will post materials and work with the City on prefunding communications; Jay Bond’s hire will become effective per his start date and the board will continue oversight via the investment committee.
