APFC Quarterly Board of Trustees Meeting

The Alaska Permanent Fund Corporation (APFC) will hold its Quarterly Meeting of the Board of Trustees on February 19-20, 2020 in Juneau, AK. The public is invited to attend this meeting in-person or by webinar; please see the agenda (linked below) for information.

Agenda items include: asset class updates from real estate and alternatives, a performance review of the portfolio from Callan LLC, as well as presentations on the earnings reserve account, APFC’s asset allocation strategy, and investment policy.

Agenda

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The Board of Trustees held its quarterly meeting in Fairbanks, Alaska on December 3-4, 2019. During the meeting, the Board examined the first-quarter investment performance of the Fund for the fiscal year 2020 (FY20) and discussed the paradigm shift of the Alaska Permanent Fund to an annual value-based methodology for consistent and stable withdrawals from the Earnings Reserve Account (ERA).

Chair Craig Richards notes that “the transition to the Permanent Fund contributing to state revenues through the Percent of Market Value (POMV) has created several new issues the Board of Trustees and state policymakers need to work through. Perhaps the most important is the risk that repeated bad years of market returns could result in the ERA not being able to fund state government and the dividend.  The Board of Trustees looks forward to developing a deep understanding of this risk, and developing recommendations to minimize it.”

Full news release: 201912_APFC BOT Quarterly Meeting News Release

The Alaska Permanent Fund Corporation (APFC) will hold its Quarterly Meeting of the Board of Trustees on December 3-4, 2019 in Fairbanks, AK. The public is invited to attend this meeting in-person or by teleconference; there will be an opportunity for public comment and participation.  Agenda items include: an update on APFC’s Real Estate portfolio, a discussion on APFC’s strategic plan, and an in-depth look at the Earnings Reserve Account. There will also be asset class updates, a performance report from Callan Associates, and a presentation from RCL Co. on Real Estate Strategies.

Agenda_APFC BOT Meeting_20191203-04_Revised

The Alaska Permanent Fund’s (Fund) investments gained 1.24% during the first quarter of the fiscal year 2020 (FY20), and the Fund ended September 30, 2019, with total assets under management valued at $64.1 billion (unaudited).

… In assessing the Fund’s FY20 Q1 performance, APFC’s Chief Investment Officer Marcus Frampton, CFA, CAIA, FRM notes that: ” … In the context of turbulent markets and a constantly changing landscape, I am pleased with this performance and believe that the portfolio is well-positioned to outperform going forward.”

… For planning purposes, APFC references both a current fiscal year and a 10-year forecast for the projected return of the Fund that is provided by our performance consultant, Callan Associates. It is understood that there will be a wide range of returns delivered by each asset class to the total Fund performance over any given time. Callan Associates projects a total return of 7% over the next 10-year period for the portfolio that APFC has constructed for the Fund.  …  It is accepted that actual results for individual years will be higher and lower, but it is expected that they will average to 7% over the forecasted period of 10 years.

… Performance overviews and updates for each asset class will be presented by Callan Associates and APFC’s Directors to APFC’s Board of Trustees during their quarterly meeting on December 3-4, 2019, in Fairbanks. The public is welcome to attend the meeting in person or via webinar, and the agenda will be posted on apfc.org one week in advance of the meeting.

Full News Release FY20 Q1

The Board of Trustees reviewed the fiscal year 2019 (FY19) investment performance of the Alaska Permanent Fund (Fund) with presentations from Callan Associates and the Alaska Permanent Fund Corporation’s (APFC) asset class directors, approved a FY2021 budget proposal, and accepted the Annual Audit as presented by KPMG. As noted in the 2019 Annual Report, released at the meeting, the Fund’s assets under management (AUM) reached an end of fiscal year high, totaling $65.4 billion as of June 30, 2019, comprised of $47.8 billion in the Principal of the Fund and $18.5 billion in the Earnings Reserve Account.

Callan Associates, APFC’s performance consultant, noted that APFC’s portfolio is well diversified across all major asset classes employed by institutional investors. In FY19 the Fund’s investments returned 6.32%, this strong performance puts the Total Fund in the second quartile relative to other large public funds, as well as other large endowments/foundations. As of June 30, 2019, the Fund’s long-term performance shows a cumulative return of 9.22% over the 10-year period and 6.35% over the 20-year period.

On September 20, 2019, APFC announced the launch of the Alaska Investment Program as directed by the Board Resolution 18-03 to establish an in-state private markets investment program utilizing external fund managers with an initial allocation of $200 million.  Chair Craig Richards notes that after a year in the making, he is “excited that the In-State Emerging Manger Program is now in place and looks forward the program’s two mangers, McKinley Capital Management, LLC and Barings, LLC., generating compelling returns for the Fund while raising capital in support of Alaska based private market investment opportunities.

The Board re-elected Trustee Richards as Chair and Trustee Brady as Vice-Chair.