NYC Public Pension System Preliminaries Show 12.95% Return

Including 2017, compound rate of return is 7.4% over the last four years.

Preliminary FY2017 results reveal that New York City’s public pension system returned 12.95%, well above the target return of 7%on its investments.

Although not yet certified and representing one year of a longer-term approach, the preliminary results were announced at the annual meeting of the New York State Financial Control Board by New York City Comptroller Scott Stringer, joined by New York State Comptroller Thomas DiNapoli, State Budget Director Robert Mujica, and Mayor Bill de Blasio.

“My office projects that last year’s performance will reduce pension contributions by more than $800 million over the financial plan period,” Stringer said in a statement. “While this is certainly good news, we should remember that our investment focus remains on the long term and the markets may be more challenging in the coming year.”

Stringer acknowledged that he does not yet have a breakdown of the asset classes which drove the returns. He did mention, however, that including 2017, investments have returned a compounded 7.4% over the last four years. 
Over the past year, CIO Scott Evans has been rebuilding leadership positions, and refreshing technology and risk management within New York City’s Bureau of Asset Management.

Stringer also provided more background on the City’s recent report that found New York City payroll employment 14% higher than it was in 2008,  prior to the recession. He also praised de Blasio on the city’s budgetary savings, noting the current budget cushion—as measured by Stringer’s office—stands at $9.8 billion, approaching the recommended 12% threshold at 11.1% adjusted spending. 

“I want to commend Mayor de Blasio for continuing to identify budget savings to build up our reserves and prepare for the inevitable rainy day,” Stringer said. In the last fiscal year, the City identified $6.6 billion in total savings through FY 2021 under the Citywide Savings Program. Our offices also continue to work together to identify debt service savings. Together, we have achieved $678 million in budgetary savings over the last four fiscal years from bond refinancing.”

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