North Carolina’s pension fund reported a 1 percent decline in the third quarter of this year, with a total increase of 9.4 percent over the last 12 months, the State Treasurer’s office reported last week.
State officials attributed the decline to losses in the fund’s stock portfolio.
The fund, which pays out to the 900,000 state employees participating in the pension system, finished out the third quarter at $88.4 billion, dropping from $90.1 billion at the end of June. The drop represents a loss of $1.5 billion.
Forty-three percent of the state pension portfolio is made up of stock investments.
That portion of the fund saw a 2.9 percent decline over the quarter but is up 10.9 percent over the past year.
Fixed-income investments make up 30 percent of the state’s portfolio. Those investments have grown 0.4 percent over the quarter and 5.9 percent over the year.
The portfolio also includes real estate and hedge fund investments.
“North Carolina’s pension continues to be solid and that’s good news for the families depending on it,” NC State Treasurer Janet Cowell said in a prepared statement. “The big stock market gains we’ve seen in the past year are leveling off, but our diversification efforts should create stability in the pension fund over the long-term.”
Full year fund summary
- The pension fund’s public equity portfolio gained 10.9 percent for the year.
- Private equity (hedge funds) gained 17.5 percent for the full year.
- Non-core real gained 17.9 percent for the year.
- Investment grade fixed income gained 5.9 percent for the year.
Both state taxes and employee payments go to fund the North Carolina Retirement Systems, the formal name for the fund.
Employees are eligible to retire with full benefits after age 65, with five years of service.
Employees receive reduced benefits after 60 years of age but before 65, with five years of service.
Employees serving 20 years are eligible to retire at age 50.
State employees participating in the program contribute 7 percent of their pay into the system.