LACERS Performs In Top Quartile Among U.S. Public Pension Funds

Los Angeles, CA. For the period ending June 30, 2006, the Los Angeles City Employees' Retirement System (LACERS) reported that LACERS total investment portfolio was up 12.4% over the last 12-month period, significantly beating its annual 8% benchmark rate of return used in the valuation of its total assets. LACERS' assets were valued at $9.3 billion - up $1 billion from the previous fiscal year ending June 30, 2005.

Three significant factors account for this rise - the performance returns of LACERS' non-U.S. equity, real estate, and private equity portfolios, which were up 28.9%, 25.6% and 27.5%, respectively, for the year. LACERS' domestic equity portfolio was up 10.6% during that time period. Bonds posted a flat return of .1% for the year. Both asset classes outperformed their benchmarks over all longer time periods.

LACERS continues to perform in the top quartile of public pension funds for 1-, 2-, 3-, 4-, and 5-year time periods. "Our performance is the result of a true collaboration between the Board of Administration, our Consultants, and our Investment staff. Our focus on costs while pursuing prudent Alternative Investment strategies has served our members well." said LACERS' Board President Eric L. Holoman.

A recent cost-effective analysis of LACERS fund performed by Cost Effective Measurement, Inc. found that LACERS generated higher returns at lower cost and with lower risk when compared to its peer group of U.S. pension funds with assets from $6.9 billion to $14 billion. Its 5-year Investment Return was 7.8%, which was above its peer median of 6.5%. LACERS' total asset management costs of 38.6 basis points were also below its comparison benchmark cost of 47.9 basis points, suggesting that the fund was low cost by -9.3 basis points. And its 5-year implementation risk was 0.6%, well below its peer median of 1.2%.