California State Teachers’ Retirement Fund Earned 13.5% in 2012

Photographer: Nick Ut/AP Photo

California Gov, Jerry Brown with business leaders, holds legislation he signed, including sweeping pension changes that will save California taxpayers billions of dollars in the future. Close

California Gov, Jerry Brown with business leaders, holds legislation he signed,... Read More

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Photographer: Nick Ut/AP Photo

California Gov, Jerry Brown with business leaders, holds legislation he signed, including sweeping pension changes that will save California taxpayers billions of dollars in the future.

The California State Teachers’ Retirement System, the second-biggest public pension in the U.S., said its investments returned 13.5 percent in 2012 on gains in stocks, private equity and real estate.

The $158 billion fund’s calendar-year earnings missed its target of 15.4 percent, it said in a statement yesterday. U.S. stock holdings rose 16 percent, while bonds returned 6.1 percent. Real estate earned 13.5 percent and private equity was up 14.6 percent, according to the statement.

Pension costs for retired public employees are straining governments from California to Rhode Island. Calstrs, as the fund is known, had assets to cover just 69 percent of projected liabilities in fiscal 2011, according to data compiled by Bloomberg.

The fund earned 1.8 percent in the fiscal year that ended June 30, below its 7.5 percent assumed rate of return.

The California Public Employees’ Retirement System, the largest U.S. pension at $254.1 billion, also earned about 13 percent on invested assets last year.

To contact the reporter on this story: Michael B. Marois in Sacramento at mmarois@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net

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