personal finance

Calpers investment chief resigns after 18 months at $400bn fund


The investment chief of Calpers has resigned after 18 months in the top job at the US’s biggest public sector pension fund.

Calpers, the $400bn Californian employee pension fund, said late on Wednesday that Ben Meng would leave effective immediately. The fund said Dan Bienvenue, deputy chief investment officer, would serve as interim chief investment officer as it looked for a permanent successor.

Mr Meng took the chief investment officer role in January 2019 after serving as a deputy at China’s $3tn State Administration of Foreign Exchange, the agency that manages the country’s capital account. The China-born American had previously worked at Calpers as the fund’s investment director for asset allocation.

To meet an ambitious 7 per cent annual performance target, Mr Meng led a push into private equity and private debt. These assets can produce higher returns but realising these during times of market stress can be difficult.

“Leverage will increase the volatility of returns but Calpers’ long-term horizon should enable us to tolerate this,” Mr Meng said in an interview with the Financial Times last month.

Mr Meng had recently drawn criticism for a plan to increase the fund’s leverage to 20 per cent of its value using borrowings and financial instruments such as equity futures. One board member, Margaret Brown, voted against the plan, saying it reminded her of the fund’s mis-steps during the 2008 financial crisis.

Mr Meng said in a statement published on Calpers website that he was “proud” of his work at the fund but “at this time, it’s important for me to focus on my health and on my family and move on to the next chapter in my life”.

Mr Meng had been brought in to turnround a shortfall in assets, which recently totalled 71 per cent of the amount necessary to fulfil projected payouts to the 1.9m public workers served by Calpers.

Calpers has been marked by executive turnover in recent years. The fund did not have a head of private equity for two years until Greg Ruiz joined in May 2019. Elisabeth Bourqui left as chief operating investment officer in January last year after eight months at the fund.

Mr Meng did not respond to a request for further comment.



READ SOURCE

Leave a Reply