Chief investment officer of N.C. state pension fund unexpectedly resigns

Kevin SigRist, the chief investment officer for the $94 billion state pension fund the past four years, has unexpectedly resigned.

SigRist submitted his resignation on Friday.

“I was surprised when Mr. SigRist gave me his resignation letter,” state Treasurer Dale Folwell, SigRist’s boss, said in a prepared statement. “It was not asked for, but I feel confident that we will continue to provide stable management for the pension fund. We will be announcing plans for the department in the very near future.”

SigRist was hired by Folwell’s predecessor, Janet Cowell, a Democrat, in 2013. He previously was deputy executive director of the State Board of Administration in Florida, which handles investments for that state’s pension fund. His annual salary was $386,081, according to the Office of State Controller.

SigRist could not immediately be reached for comment.

SigRist’s departure comes as Folwell, a Republican who was elected in November, is shaking things up at the state pension fund.

Folwell has cut fees paid to outside money managers by more than $60 million on an annualized basis, easily exceeding his campaign promise to slash fees by $100 million during the course of his four-year term.

In conjunction with that cost-cutting, Folwell has shifted billions of dollars previously invested in stocks into investment-grade bonds and cash – for example, investing in things such as short-term U.S. Treasury bills. At times, according to internal memos reviewed by The News & Observer, Folwell has overruled the recommendations of the pension fund’s investment staff in shifting those funds out of stocks.

Critics say the pension fund’s potential returns are being reduced because stocks typically outperform bonds and cash.

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But Folwell said in a recent interview that when he took office the pension fund had too much invested in stocks and that the fund had lost billions – at least on paper – from its stock investments during the recession. He also said the pension fund’s need for cash has been underestimated.

“A new Treasurer comes in and wants to do things differently,” said Andrew Silton, who was chief investment officer for the state pension fund from 2001 to 2005. “The Treasurer is basically undoing what SigRist (spent) lots of time putting together.”

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