American Investment Council (AIC) officials indicated findings from its 2022 public pension study showed private equity delivered the strongest returns for public pension portfolios.
The survey involved analyzing 176 domestic public pension funds representing nearly 34 million public sector workers and retirees, with 89 percent of public pensions in the sample possessing some exposure to private equity.
“Public pensions represent a promise to take care of the public servants who take care of us,” AIC President and CEO Drew Maloney said. “In order to offer retirement security for dedicated public servants, these funds must consistently generate strong investment returns. Almost all of them turn to private equity for help.”
Maloney said this year’s pensions report highlights why more than 30 million Americans trust private equity to deliver strong and secure retirements.
In 2021, private equity investments delivered a median annualized return of 15 percent over 10 years for public pension funds across America partnering with private equity.
“Ohio SERS (School Employees Retirement System) is pleased to be ranked among the top ten in Private Equity returns for the 10 years ending June 30, 2021, with a return of 17.6 percent,” Ohio School Employees Retirement System Chief Investment Office Farouki Majeed said. “Our Private Equity portfolio has consistently generated the highest return in the SERS portfolio over rolling 10-year periods for many years and has contributed to the long-term sustainability of the pension plan.”
Majeed said the strategy pursued by staff in target markets has been successful and resulted in lower fees.