The California Public Employees' Retirement System, the biggest U.S. public pension fund, said on Monday it posted a 12.5 percent return on its assets for the 12 months ended June 30, outperforming its benchmark by 1.5 percentage points.
The pension fund, whose assets are worth about $260 billion, said its global public equity and real estate holdings propelled much of the gain.
"Investments in domestic and international stocks returned 19 percent, outperforming the CalPERS custom public equity benchmark by nearly one percentage point," the fund said in a statement.
"Investments in income-generating real properties like office, industrial and retail assets returned 11.2 percent, outperforming the Pension Fund's real estate benchmark by 1.4 percent," the fund added.
The value of the pension's fund's assets is hovering near its peak of about $260 billion set in October 2007. It sank to about $160 billion during the financial crisis.
At 12.5 percent, the fund's return for the most recent 12-month period exceeded its target 7.5 percent rate of return, which is used to set contribution levels to the retirement system for government agency employers.
Those rates will be calculated based on audited figures and will appear in contribution levels for state agency employers in fiscal 2014-15 and for contracting cities, counties and special districts in fiscal 2015-16, the pension fund said.
Public pension costs have become a growing concern for governments across the nation amid lean revenue. In California, state leaders approved legislation last year aimed at reining in pension expenses after voters in San Diego and San Jose, the state's second- and third-biggest cities, approved measures to clamp down on local pension costs.
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