Managers of state pension funds get $14 million in bonuses

Wisconsin pension fund managers and those who work directly with the state’s investments will receive bonuses totaling nearly $14 million this year. This is the highest total ever, as a reward for strong returns, the State of Wisconsin Investment Board announced.

The $13.8 million in bonuses was approved for 152 of 163 board employees, exceeding the $11.1 million handed out last year, the board announced.

Eleven people did not receive bonuses because they either did not qualify or their job performance did not meet expectations, said board spokeswoman Vicki Hearing.

Fifty-one employees — a third of those who got bonuses — received $100,000 or more. The highest — $582,489 — went to David Villa, the board’s chief investment officer. That’s on top of his annual salary of $442,500.

Charles Carpenter, a managing director, received the second highest at $550,770. His annual salary is $291,500.

The third biggest bonus went to Todd Ludgate, another managing director, who received $541,221. His salary is $236,000.

The bonuses were $500,000 more than the previous record high of $13.3 million in 2014.

The bonuses are awarded based on investment performance above market returns over the past five years, the board said in announcing the pay-outs.

The board ended 2016 beating one-, three- and five-year performance benchmarks.

Over the past five years, investment performance above market returns has added $1.2 billion to the retirement system, the board said.

David Stein, chair of the SWIB Board of Trustees, said “Bottom line, you get what you pay for, and by virtually any measure, this plan is working.”

The board’s management of its investment is a reason why Wisconsin’s public pension fund is financially strong at a time when many others are struggling, said SWIB executive director Michael Williamson. His bonus was fourth highest at $520,000.

Last year the “Core Fund,” a diversified group of investments that all retirees have some money in, had an 8.5 percent return. The more volatile “Variable Fund,” which has higher risk and about 40,000 investors, had a 10.6 percent return.

The board manages more than $104 billion in assets, most of which is in the Wisconsin Retirement System, which has more than 600,000 participants.