IMRF Pensions At Risk

SVB collapse may hit Illinois retirement system

The Illinois Republican

If you are a Sheriff's Deputy with IMRF (SLED) This applies

To you. Your pension is at risk!

Illinois Policy Institute Article

Documents show the Illinois Municipal Retirement Fund may have taken a multi-million dollar hit when Silicon Valley Bank recently collapsed.

The latest report of detailed investments available from the IMRF shows the fund had over $4.5 million invested in 12,621 shares of SVB Financial Group, the parent company of Silicon Valley Bank. Those shares had a fair market value of $8.6 million at the end of 2021 when the stock had a value near $700 per share.

Incomplete data makes it difficult to say what the IMRF’s exposure was when SVB went belly up.

This is apparently stirring up the same very online people who always seem to be easily stirred up. And oftentimes they’re stirred up for no good reason.

* So, I reached out to the IMRF’s John Krupa…

IMRF does hold some shares in Silicon Valley Bank Financial Group. As of a few days ago, these shares represented a market value of about $3 million. While we are always concerned about any losses, for context, IMRF holds about $49 billion in assets. So, these shares make up a very small part of our total portfolio - about 0.006% (a fraction of a percent). Any potential losses will have no impact on IMRF’s ability to pay benefits. We will continue to monitor the situation closely and adjust in accordance with our investment policies.

In your article, please consider adding the context that nearly every large institutional investor with index fund holdings has some exposure here. I think the recent coverage linking IMRF and SVB Financial Group is incomplete and confusing for readers. It’s almost as though IMRF’s name was “picked out of a hat” and linked with SVB. This connection is ironic considering we are widely considered the “gold standard” in the public pension industry. We are one of the best-funded pensions in America at 98%, and our local government contribution rates remain stable. We have even won a presidential award for performance excellence (The Baldrige National Quality Award).

So, in summary, IMRF’s SVB Financial Group losses are regrettable, and we take them seriously. But this is an industry-wide issue; it’s not unique to IMRF. And in our individual case, it’s having a de minimis impact on our overall portfolio and IMRF members, employers, and taxpayers should rest assured that the fund remains healthy and strong.