San Diego County Terminates OCIO Salient

The $10.6 billion public pension fund and Salient Partners will end their relationship as of August 15.

The San Diego County Employees Retirement Association (SDCERA) announced it would terminate its contract with outsourced-CIO (OCIO) Salient Partners effective August 15.

The board’s decision brings to an end SDCERA’s six-year discretionary relationship with the Houston, Texas-based firm.

“Since Steve Sexauer’s arrival as our CIO, Salient has worked in close collaboration with us to ensure the transition to an in-house program is successful.” —SDCERASkip Murphy, board chair for the $10.6 billion public pension fund, said the termination indicates a “philosophical shift to return to an in-house investment management program.”

Last November, SDCERA’s board initially voted to transition the portfolio from Salient. The fund also hired Steve Sexauer, former CIO of Allianz’s US multi-asset team, as its internal CIO in May.

“Since Steve Sexauer’s arrival as our CIO, Salient has worked in close collaboration with us to ensure the transition to an in-house program is successful,” Murphy continued. “We are confident that cooperation will continue until the transition is completed.”

Sexauer likewise commended Salient and its CIO Lee Partridge’s efforts in creating a smooth transition and said their work has been “careful, thorough, and professional.”

Salient said in a statement that it was pleased with the value it has helped create for San Diego County’s plan members and retirees.

“Salient came aboard during a period of considerable market turbulence and, during our tenure, the fund’s assets grew by $4.5 billion,” Partridge said. “We’re optimistic about the system’s continued health under Mr. Sexauer’s leadership.”

Related: San Diego County Hires CIO & San Diego’s Bumpy Transition from OCIO

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