BOSTON – Massachusetts’ state pension fund lost 8.9 percent last year as falling U.S. stock prices caused the pool to turn in the worst performance since its creation in 1986.
The nation’s 31st largest pension fund, with $26 billion invested for about 235,000 retired and working state employees and teachers in Massachusetts, has about 40 percent of its assets in U.S. stocks and about 20 percent in international stocks.
The Massachusetts fund had its third consecutive year of losses after posting its first-ever negative return in 2000. The results were in line with other public pensions that tend to be heavily weighted in stocks, said James Hearty, executive director. In the six fiscal years between 1995 and 2000 that ended June 30, the fund’s worst return was a positive 12.7 percent.
The Massachusetts pension’s domestic equity assets fell 20.3 percent to $10.5 billion last year, as its benchmark, the Wilshire 5000 Index, dropped 20.9 percent. The pension also invests 16.4 percent of its assets in international stocks, which fell 14.9 percent to $4.2 billion while its benchmark, the Morgan Stanley Capital International EAFE Index, fell 15.9 percent. (Bloomberg News)
Eaton Vance cut bonuses
of CEO, top execs by 26 percent
BOSTON – Eaton Vance Corp., a money manager whose earnings fell the past two quarters as assets declined, cut the bonuses of top executives including Chief Executive James B. Hawkes by 26 percent last year.
The bonus of Hawkes, who is also president of the Boston-based company, dropped to $2.3 million from $3.13 million in 2001, according to Eaton Vance’s 10-K filing with the U.S. Securities and Exchange Commission. His total compensation declined 22 percent to $2.94 million.
Mutual fund firms, which collect fees based on the amount of assets they manage, have been hurt by the three-year drop in the stock market – the longest losing streak since the Great Depression. For the year ended October 31, Eaton Vance has $55.6 billion in assets under management, 2 percent less than the previous year.
Chief Investment Officer Thomas E. Faust Jr.’s bonus fell by $742,500 to $2.1 million. His total compensation fell 23 percent to $2.54 billion, according to the filings. The bonuses of Alan Dynner, chief legal officer, and William M. Steul, chief financial officer, fell to $450,000 from $610,000, according to the 10-K. The salaries of both executives remained the same at $280,000. (Bloomberg News)
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