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MOSERS’s Seth Kelly Lands CIO Job at Pennsylvania Fund

The Pennsylvania State Employees’ Retirement System has been searching for a new investment chief for nearly a year.

The Pennsylvania State Employees’ Retirement System board has voted unanimously to appoint Seth Kelly to the role of chief investment officer.  

Kelly, who stepped down as the CIO at the Missouri State Employees Retirement System (MOSERS) in December, is set to take the helm at PA SERS pending approval, the $31 billion retirement system announced Friday.  

PA SERS has been looking for a permanent CIO since August 2019 after Bryan Lewis, who spent four years as its investment chief, left to run investments at the United States Steel Corp.  

Kelly spent 16 years at MOSERS, nearly four of which as the retirement system’s chief investment officer. Prior to joining MOSERS, Kelly spent five years working in investments at a local Missouri bank, his LinkedIn profile shows. 

“His strong background in public funds, coupled with his record of leadership and achievement at our sister organization in Missouri are strong assets, which PA SERS will benefit from in the months and years ahead,” said Terrill Sanchez, the Pennsylvania fund’s chief executive officer and board secretary, in a statement. 

After Kelly left MOSERS, the retirement system announced in February that it promoted interim CIO Shannon Davidson to the post permanently.  

Meanwhile, between Lewis’s departure and Kelly’s appointment, PA SERS deputy CIO James Nolan has been managing investments for PA SERS.  

Nolan “has been instrumental in helping to guide the SERS Board through its latest asset allocation process in December, and then through a very challenging market environment,” said David Fillman, board chairman, in a statement.  

It’s unclear when Kelly will begin his tenure as chief investment officer. The start date is under negotiation, a PA SERS spokesperson said via email Monday. The board chairman will have to approve a Pennsylvania Office of State Inspector General background investigation, according to the announcement. 

The retirement system worked with CBIZ Talent and Compensation Solutions on the executive search, the PA SERS spokesperson said via email.  

[II Deep Dive: Ex-Pennsylvania SERS Chief Named CIO at U.S. Steel

According to a June 10 announcement, PA SERS lost 11.69 percent net of fees during the first quarter of 2020.  

The retirement system’s investments in international developed markets equities were the worst performing, losing 23.66 percent of their value during the quarter. Private credit and private equity led the portfolio in terms of performance during the first quarter, returning 2.47 percent and 2.4 percent respectively. 

In December, PA SERS adopted a new asset allocation strategy with the goal of reducing costs and its correlation with public equity markets, the announcement shows. The retirement system moved money to more liquid assets, which “provides increased security and diversification that helps the portfolio to withstand market turbulence and pay retirement benefits.” 

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