New Hampshire pension to stick with NEPC as investment consultant

  • NEPC has already had one contract extension
  • Contract would give NEPC slight pay cut
  • State committed $125 mln to PE so far in 2018

New Hampshire Retirement System plans to stick with NEPC as its investment consultant, pending final approval by the board in December.

NEPC has been general investment consultant for the $8.7 billion system since the start of 2013, and it will take a fee cut in exchange for a two-year extension.

Originally signed to a three-year deal after a request-for-proposal process in 2012, NEPC received a three-year extension in 2015, which is due to expire on Dec. 31.

The pension fund’s investment committee recommended a two-year extension at its Nov. 16 meeting, and the full board is expected to approve that recommendation next month, according to public information officer Marty Karlon.

NEPC’s extension would run through Dec. 31, 2020, and would shave $40,000 off the previous price over a two-year period.

NEPC had previously proposed a contract that would earn it $765,000 for 2019 and $775,000 in 2020, but it will accept a flat $750,000 for each of those two years instead, according to pension fund documents.

That will be a pay cut from the $755,000 it earned in 2018, but it will be higher than the average annual value of its contract since 2013.

Callan Associates was the other finalist during the 2012 competition.

The pension system has a private equity portfolio valued at $1.55 billion, composed of buyouts, secondaries, growth equity, secondaries, VC and energy.

The system has committed $125 million to PE strategies to date in 2018, committing $25 million to Industry Ventures Partnership Holdings Fund V, $50 million to Thoma Bravo Fund XIII and $50 million to Warburg Pincus Global Growth fund.

All commitments were made to managers that New Hampshire has previously invested with.

Action Item: Read more on NHRS investments here