NHRS Realizes 1.0% Return on Investments in Fiscal Year 2016

Trust fund assets stand at $7.46 billion as of June 30, 2016

Oct 14, 2016
  • NHRS

For Immediate Release: October 14, 2016
Contact:  Marty Karlon, Public Information Officer, (603) 410-3594; [email protected]

CONCORD, NH – The New Hampshire Retirement System (NHRS, the retirement system) realized a 1.0% return on investments in the fiscal year ended June 30, 2016.

The three-year, five-year, 10-year, 20-year, and 25-year returns for the periods ended June 30, 2016, were 7.1%, 7.2%, 6.0%, 7.0%, and 8.2%, respectively.  The retirement system’s assumed rate of investment return was recently reduced from 7.75% to 7.25%.

Compared to the members in the InvestorForce Public Defined Benefit Universe, which represents 260 public plans totaling more than $454.6 billion in assets, NHRS performed better than 90% of its peers over the five-year period and better than 87% of its peers over the 25-year period. All returns are net of fees.

“Like all investors, NHRS has dealt with a volatile and challenging investment landscape over the past two years,” said NHRS Executive Director George Lagos. “These challenges included weak corporate earnings, instability in global energy markets, a historically low and uncertain interest rate environment and slowing economic  growth in China. The ‘Brexit’ vote in the United Kingdom within one week of the end of the current fiscal year further muted investment returns.”

NHRS pursues a long-term investment strategy designed to meet its funding requirements.  The Board of Trustees, with research and input from NHRS investment staff, outside experts, and a recommendation from the Independent Investment Committee (IIC), set an investment policy that includes asset allocation targets and ranges. 

The five-member IIC continuously monitors and evaluates performance, and makes determinations regarding the hiring and retention of fund managers.

“The Independent Investment Committee is focused on prudently managing the risk, return, and liquidity of the portfolio in accordance with the investment policy set by the Board of Trustees,” said Lagos. “The most recent market performance, though disappointing, is not unanticipated. As long-term investors, we know that we will see returns above and below our assumed rate of return. Our goal remains to meet or exceed the assumed rate of return over the long term.”

At the close of the fiscal year, the retirement system’s unaudited net position held in trust was $7.46 billion, a decrease of approximately $70 million over the prior fiscal year, which stood at $7.53 billion.

Further information on the retirement system’s investment performance is available online at: https://www.nhrs.org/funding-and-investments/investments

Detailed fiscal year 2016 financial and investment information will be included in the retirement system’s comprehensive annual financial report and comprehensive annual investment report, both due out in December.

About NHRS

NHRS provides retirement, disability, and death benefits to its eligible members and their beneficiaries.  The State of New Hampshire and nearly 470 local government employers participate in NHRS for their employees, teachers, firefighters, and police officers.  NHRS has approximately 48,000 active members and 31,000 pension recipients. NHRS administers a defined benefit plan qualified as a tax-exempt entity under sections 401(a) and 501(a) of the Internal Revenue Code.

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