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IPERS reports 29.6% FY21 investment return, reduces unfunded liability

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Double-digit earnings over the past fiscal year boosted the Iowa Public Employees’ Retirement System (IPERS) Trust Fund to a record $42.85 billion market value, and enabled IPERS to significantly reduce its unfunded liability. “IPERS achieved a near-record 29.6% investment return in FY2021 that generated more than $9 billion for the IPERS Trust Fund that pays member benefits,” IPERS CEO Greg Samorajski said in a release. According to an annual valuation report, IPERS’ funded ratio grew to 88.3% in the fiscal year that ended June 30, 2021, up from 84% in the prior fiscal year. IPERS’ unfunded actuarial liability decreased from $6.6 billion in FY2020 to $4.9 billion in FY2021. “The unprecedented investment earnings were central to increasing the funded ratio and lowering the unfunded liability,” Samorajski said. A projection in the report shows that IPERS expects to eliminate the unfunded liability completely by 2046. The annual valuation means that regular IPERS members’ funding rate will remain the same for fiscal 2023. At its board meeting Thursday, IPERS staff outlined plans to commit up to $3.125 billion to private market investments in calendar year 2022. Staff anticipates making commitments of up to $1 billion to private equity investments, $1.325 billion to private credit investments and $800 million to private real asset investments in 2022.