2009-08-27-RB-min - Laserfiche WebLink

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MINUTES OF THE AUGUST 27, 2009 RETIREMENT MEETING Present: Robert Cunha, Joseph Foley, Michael McNabb, Rob Addelson, Alan Fields, Marguerite Oliva Bob Cunha called the meeting to order at 8:00. The Board accepted and signed the 083109 warrant and the August payroll. New Members: (1) Samuel Russo, Custodian Request for Retirement: (5) Elizabeth Gable, School Library Aide, 6130109; Barbara Bair, Instructional Asst., 8121109; James Brooks, Patrolman, 9/30109; Elaine McBride, Aide, 811109; Stephen O'Loughlin, Fire Lt., 8117109 Deceased Retirees: Alice Benoit, Opt. A, School Lunch, 8116109 LouAnn Eisenhut from Meketa Investments presented the June quarterly review. Stocks rallied both domestically and abroad in the second quarter, posting the strongest quarterly returns since 2003. The market value for Lexington at the end of June was $85.2M. At the end of July the value increased to $89.8M. LouAnn gave an investment manager overview for Loomis Credit Asset Fund prior to representatives from Loomis making their presentation. Loomis' target allocation is 30- 100% Investment Grade Corporate, 0 -50% High Yield Corporate /Bank Loans and 0 -15% Securitized Assets. The three sector leaders who act as portfolio managers for the Credit Asset Fund are Mattthew Eagan (high yield), Kevin Kearns (investment grade), and Richard Raczkowski ( investment grade). They are supported by 23 research analysts. Loomis representatives Roger Ackerman, Matt Eagan and Will Averill made the presentation to the Board. Loomis Sayles has been in existence since 1926, serving institutional investors for more than 80 years. As of Tune 30, 2009, Loomis Sayles has $113 Billion fixed income assets under management. The Loomis Credit Asset Fund was funded in March 2009. The gross returns for 3/16- 6130/09 were 13.00% and 20% year -to -date. Reports are on file in the retirement office. The Board discussed that we are always chasing the 8% assumption. Mike mentioned the "Credit Cycle Theory" from the Loomis report. The cycle starts with a downturn where equity and credit are negative followed by credit repair where credit outperforms equity. Next step is recovery where equity and credit are positive and finally expansion where equity outperforms credit. The cycle will be elongated and the current environment will probably last longer for recovery. Alan questioned from where the funding should come for investment with Loomis. Right now there is 6% in the bond market. To liquidate the SSgA Passive Bond