West Virginia's $10 billion-plus investment portfolio lost about another $200 million of value in August, bringing total investment losses since July 1, 2007, to about $825 million, the executive director of the state Investment Management Board told legislators Tuesday.
CHARLESTON, W.Va. - West Virginia's $10 billion-plus investment portfolio lost about another $200 million of value in August, bringing total investment losses since July 1, 2007, to about $825 million, the executive director of the state Investment Management Board told legislators Tuesday.
However, Craig Slaughter said actual losses from unrecoverable investments in stock of companies like Lehman Brothers that collapsed during financial upheaval is much smaller, in the range of about $35 million.
"I can tell you it is very small. Our exposure to any one company is tenths of one percent of the entire portfolio," he told the Joint Committee on Government and Finance.
Slaughter did not dispute the assessment of Senate Finance Chairman Walt Helmick, D-Pocahontas, that the portfolio's losses prior to Monday's market surge probably approached $1 billion.
"The reality is, the value of this portfolio is $1 billion less than it was when we were in our heyday," Helmick said.
That, he said, effectively offsets all the revenue from budget surpluses the state has enjoyed over the past four years.
Slaughter said the current economic turmoil has not caused the board to change its investment strategies, which look at long-term growth over 15, 20, to 30 years.
"It is possible to gain it all back if the market accelerates forward," he said of current portfolio losses.
Also Tuesday, Slaughter said the Consolidated Public Retirement Board is holding about $246 million in assets from former Teachers Defined Contribution accounts that were "swept" when those participants opted to join the Teachers Retirement System.
CHARLESTON, W.Va. - West Virginia's $10 billion-plus investment portfolio lost about another $200 million of value in August, bringing total investment losses since July 1, 2007, to about $825 million, the executive director of the state Investment Management Board told legislators Tuesday.
However, Craig Slaughter said actual losses from unrecoverable investments in stock of companies like Lehman Brothers that collapsed during financial upheaval is much smaller, in the range of about $35 million.
"I can tell you it is very small. Our exposure to any one company is tenths of one percent of the entire portfolio," he told the Joint Committee on Government and Finance.
Slaughter did not dispute the assessment of Senate Finance Chairman Walt Helmick, D-Pocahontas, that the portfolio's losses prior to Monday's market surge probably approached $1 billion.
"The reality is, the value of this portfolio is $1 billion less than it was when we were in our heyday," Helmick said.
That, he said, effectively offsets all the revenue from budget surpluses the state has enjoyed over the past four years.
Slaughter said the current economic turmoil has not caused the board to change its investment strategies, which look at long-term growth over 15, 20, to 30 years.
"It is possible to gain it all back if the market accelerates forward," he said of current portfolio losses.
Also Tuesday, Slaughter said the Consolidated Public Retirement Board is holding about $246 million in assets from former Teachers Defined Contribution accounts that were "swept" when those participants opted to join the Teachers Retirement System.
Currently, those assets are in a VALIC fixed-interest annuity, pending completion of paperwork to transfer them to the Investment Management Board, he said.
Senate President Earl Ray Tomblin, D-Logan, suggested that for the moment, it might be wise to leave those assets in interest-bearing annuities.
"We've probably saved with VALIC having the money for this period of time than with you having it," Tomblin told Slaughter.
Slaughter said many of the assets probably will stay in annuities for the short term, since there are penalties for early redemptions of the annuities.
Meanwhile, state budget director Mark McKown told an interim committee that the state has $21.46 million in unappropriated funds.
That includes $17.6 million of budget surplus from the 2007-08 budget - by law, the other half of the total surplus of $35.7 million was transferred to the state's "Rainy Day Fund," which has a balance of $565.43 million.
Legislators also left $3.74 million of revenue in the current 2008-09 budget unappropriated.
Reach Phil Kabler at ph...@wvgazette.com or 348-1220.
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