SAIPAN, CNMI (Marianas Variety, Jan. 29) - The Retirement Fund has terminated its contract with a Hawaii-based money manager after it lost $4.3 million of the Fund’s original investment within a three-year period.

Fund Administrator Karl T. Reyes said their original account with Bishop Street was valued at $10 million. Much of this money was invested in mutual funds.

After the Fund’s capital went down to $6 million last year, it took half of that amount and left Bishop Street to manage $3 million.

As of this month, the $3 million left further shrunk to $2.7 million, prompting the Fund’s board to order the termination, Reyes said.

The money has been transferred to Atalanta, the Fund’s "strongest" money manager at the moment.

"The board chose to give it to them because they are the best performing money manager at this point," Reyes said.

Concerns have been raised about the volatile situation of the international stock market and its effect on the Fund’s investments. Some board members want the Fund to increase its allocation for local investments.

Reyes said he does not see any problem with this proposal as long as the Fund can identify "real strong local investments."

In an earlier interview, Fund Chairman Joseph Reyes said Verizon could be a good local investment for the agency.

The Fund administrator agrees that Verizon is "strong" but he suggested that the proposal be evaluated thoroughly.

January 29, 2003

For additional reports from the Marianas Variety, go to PACIFIC ISLANDS REPORT News/Information Links: Newspapers/ Marianas Variety. 

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