The California Public Employees’ Retirement System paid out double the bonuses to its staff last year because improved market performance helped the pension plan recoup its losses from the Great Recession.
More than 100 employees received a total of $7.7 million in bonuses, more than twice the $3.6 million paid out the previous year.
Joe Dear, CalPERS’ chief investment officer, received a $321,750 bonus on top of his base salary of $500,000 and three other investment officers were paid more than $200,000 apiece, according to CalPERS.
CalPERS was one of the hardest hit pension systems in the country during the recession, losing a third of its value in 18 months.
Some might question why the system, which has been underfunded and struggling since the downturn, would pay bonuses to its executives the moment the system started recovering.
The fund has said it needs to grant bonuses to its investment staff to remain competitive with Wall Street. Instead of farming out its investment management, CalPERS keeps this service in-house, which saves the system about $100 million a year in Wall Street fees, the organization said.
The California State Teachers’ Retirement System, which is the second-largest pension in the state, paid $134,400 in bonuses to CEO Jack Ehnes, and $133,773 to Chief Investment Officer Christopher Ailman last year. It paid out a total of $1.9 million in bonuses while earning a 13.8 percent return on its investments in the fiscal year ended June 30.