The Marianas Public Land Trust credits its conservative investment strategy for saving the agency\u2019s investments from total collapse since the financial meltdown that hit global markets several years ago.<\/p>\n
MPLT board chair Alvaro Santos said the board immediately switched from an aggressive approach to a more conservative strategy in 2006 and has been using that approach since then as a result of the volatile market.<\/p>\n
MPLT\u2019s portfolio currently totals $71 million.<\/p>\n
Compared to the NMI Retirement Fund, Santos said that the Fund has been more aggressive in dealing with its portfolio. The Fund currently has over $264 million in assets. <\/p>\n
Despite the huge difference in market value, the Fund is projected to be depleted in just three years, mainly because of the central government\u2019s failure for so many years to remit its employer contribution to the Fund.<\/p>\n
Santos said that since 2006, the board has been using a conservative strategy by investing in fixed incomes (65 percent) and equities (35 percent). He said the board prepared itself for the \u201cbig storm\u201d that would hit all investments.<\/p>\n
Santos said the MPLT board changed its investment strategy at the advice of their investment consultant. MPLT\u2019s portfolio is being managed by seven money managers who, in turn, are being monitored by Morgan Stanley Smith Barney. <\/p>\n
In fiscal year 2011 ending Sept. 30, MPLT recorded an investment return of 5.9 percent. \u201cDespite the volatile market condition, we did well [last fiscal year] with 5.9 percent return of investment,\u201d said Santos, adding that the board is satisfied with the overall performance of the agency.<\/p>\n
The Fund is now suing its former investment consultant, Merrill Lynch, for allegedly giving the board bad advices that resulted in significant investment losses. The case is pending in court.<\/p>\n
In October 2010, the Fund board hired Wilshire Associates as its new investment consultant. It immediately recommended the adoption of a conservative strategy called the Glide Path 2013. <\/p>\n
Santos said the Fund should have adopted this strategy \u201cway, way back.\u201d<\/p>\n
\u201cIn the case of the retirement program, they have an obligation to disburse every 15 days [to pay for pensions]. Personally, I think that they should have adopted the Glide Path concept much, much earlier. Why? Because they have fixed obligation to their members. The Fund has engaged in a high-yield aggressive market approach. If the market is very volatile, I don\u2019t think you will want to venture into that kind of environment and take a chance,\u201d said Santos.<\/p>\n
MPLT is mandated to remit the revenue it earns from all its investments to the general fund every year. Two weeks ago, it remitted $2 million as earnings for last fiscal year. <\/p>\n
\u201cHowever, if the economy of the CNMI improves and the central government is able to meet its basic financial obligations, then we can go back to a more aggressive and pro-active market investment strategy,\u201d added Santos.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Marianas Public Land Trust credits its conservative investment strategy for saving the agency\u2019s investments from total collapse since the financial meltdown that hit global markets several years ago.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-156712","post","type-post","status-publish","format-standard","hentry","category-local-news"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/156712","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=156712"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/156712\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=156712"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=156712"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=156712"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}