CORRECTION: An earlier version misstated the factors behind the drop in asset totals for the pension funds. Markets were a relatively small factor in the decline.
A drop in the value of Connecticut’s state pension funds in fiscal 2012, combined with payments to retirees, caused the funds’ total assets to decline by $1.2 billion, the state treasurer says.
The state’s six pension plans and eight trust funds finished the 12 months ended June 30 with assets totaling $24 billion, down from $25.2 billion a year earlier, Treasurer Denise L. Nappier’s office said Friday.
One billion dollars of the decline was tied to payment of benefits to retirees. The remainder was due to market losses, her office said.
Since then, the market value of the plans has risen by about $560 million, to $24.6 billion, the treasurer said.
The loss follows several years of solid returns for the state pension plans, which are collectively called the Connecticut Retirement Plans and Trust Funds (CRPTF) and managed on behalf of about 190,000 state municipal workers and retirees.
The CRPTF generated a record 21 percent return in fiscal 2011 and 10.54 percent return for the three year period ending June 30, despite the difficult market climate of 2012.
“It comes as no surprise that the 2012 fiscal year end performance results are not as we had hoped, but more along the lines of what we expected,” Nappier said in a statement. “The Great Recession clearly was not a hit-and-run event — it has been an unprecedented financial crisis.”
Nappier said the $1.2 billion loss in fiscal 2012 reflects declines in market values as well as non-market related activities including management fees, net beneficiary payments, and other pension fund operating expenses.
