RD171 - VRS Oversight Report No. 34 - VRS (Virginia Retirement System) Semi-Annual Investment Report - July 2010


Executive Summary:
While the recent global recession created significant investment challenges for the Virginia Retirement System (VRS), economic conditions have shown gradual improvement, and VRS assets have recovered some of the losses experienced in 2008 and 2009. With $50 billion in assets as of March 31, 2010, the VRS pension fund achieved a return of 31.2 percent for the one-year period. The value of the total fund increased by $11.1 billion between March 31, 2009 and March 31, 2010. Despite these gains, the fund’s performance was lower than established benchmarks for the one- and three-year periods ending March 31, 2010. However, it exceeded benchmarks for the five- and ten-year periods. Moreover, the fund did not earn the assumed actuarial rate of return, 7.5 percent, for the three-, five-, and ten-year periods ending March 31, 2010. Over the ten-year period, however, the fund did add value (130 basis points) over the long-term benchmark.