The Missouri State Employees Retirement fund will dump investments tied to Russia and bar investment managers from making future purchases of Russian securities, the Board of Trustees decided Thursday.
The board held a special meeting in response to the call from state Treasurer Scott Fitzpatrick to divest. After a brief discussion, including a presentation from chief investment officer T.J. Carlson that showed the current Russian assets are essentially worthless, the board unanimously approved a motion from Fitzpatrick to end all involvement with Russian assets.
“We are doing the right thing and it seems like a lot of this is going to happen organically in the markets,” Fitzpatrick said after the vote.
The retirement system, known as MOSERS, has no direct ownership of Russian securities but does have a small portion of its $13.4 billion portfolio in funds that own assets in markets worldwide. That investment, worth $18.6 million on Dec. 31, had lost 90% of its value by Wednesday, to about $1.6 million, Carlson told the board.
On Wednesday, the manager of the funds, Morgan Stanley Capital Investments, announced it would reclassify the Russian investments to a standalone market instead of an emerging market fund, “at a price that is effectively zero and as of the close of March 9, 2022.”
That means the Russian asset portion of MOSERS’ original investment in those funds is worthless, Carlson said.
Since Russia invaded Ukraine on Feb. 24, several states have taken steps to eliminate their Russia-linked holdings. President Joe Biden has imposed severe sanctions on Russia, as have many other countries.
In a presentation to the board, Carlson said the MOSERS portfolio has also been reviewed for investments tied to the sanctioned companies and individuals.
“We don’t have any exposure to any sanctioned companies,” Carlson said.
The three largest funds managed by the state aside from MOSERS are the Local Government Employees Retirement System, or LAGERS, the Public School and Education Employee Retirement System, or PSRS/PEERS, and the Missouri Department of Transportation and Highway Patrol Employees’ Retirement System, or MPERS.
The PSRS/PEERS Board of Trustees has set a meeting for Friday morning to discuss its investments tied to Russia. The PSRS/PEERS fund is the state’s largest with $57.9 billion in assets and a total exposure of approximately $138.9 million in Russian securities, Susan Wood, director of communications, wrote in an email Tuesday.
LAGERS has $8.3 million in Russian securities in its $10.3 billion asset portfolio, Elizabeth Althoff, legislative and …….
