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CalPERS reports dismal earnings on investments

  • In this photo taken Thursday, June 21, 2012, state Sen. Mark Wyland, R-Solana Beach,left, talks with Sen. Anthony Canella, R-Ceres at the Capitol in Sacramento, Calif. Democrats in the Legislature blocked Republican attempts to bring Gov. Jerry Brown's public pension reform plan up for a vote. (AP Photo/Rich Pedroncelli)

SACRAMENTO, Calif. - The nation's largest public pension fund collected a dismal 1 percent annual return on its investments, a figure far short of projections that will likely bring pressure on California's state and local governments to contribute more money, officials said Monday.

The return reported by the California Public Employees' Retirement System was well below its projected return of 7.5 percent for the fiscal year that ended June 30 and is prompting administrators to consider changes to investment strategies.

The investment returns are critical because taxpayers are on the hook for the difference if the pension funds fail to meet their performance targets.

"The last 12 months were a challenging period for all investors," chief investment officer Joe Dear said about the stock market's performance amid the ongoing European debt crisis and slow global economic growth.

The fund was most impacted by a minus-7 percent return on global equities. Half the pension's assets are in equities, Dear said.


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