February 10, 2011

Positive Fourth Quarter and Year-to-Date Returns in 2010 for U.S. Master Trust Universe, According to BNY Mellon Asset Servicing


US equities the major driver of plan performance, up 11.8% for Q4 and 18.8% for the year

BOSTON, Feb. 10, 2011 — The median return of the BNY Mellon U.S. Master Trust Universe was 5.60% for the fourth quarter of 2010, contributing to a return of 12.89% for the full year.  Plan sponsors have now broadly recouped their losses from the global financial crisis with a three-year median return of 40 basis points, on an annualized basis.

With a market value of $2.05 trillion and an average plan size of $2.9 billion, the BNY Mellon U.S. Master Trust Universe is a fund-level tracking service that can be used to make peer comparisons of both performance and asset allocation results.  The Universe consists of 698 corporate, foundation, endowment, public, Taft-Hartley and health care plans.

"Public plans were the top performers in the fourth quarter, returning 5.99%, due to their relatively greater allocations to U.S. equities," said Greg Stewart, managing director and regional product manager of BNY Mellon Asset Servicing.  "However, for the full calendar year, corporate pensions had the strongest returns with a median result of 13.50%."

Highlights

  • 96% of plans posted positive results for the quarter ending December 31, 2010.  For the twelve months ending December 31, 2010, all plans were in the black.
  • 6% of plans matched or outperformed the custom policy return of 8.06% for the fourth quarter.  For the twelve-month period, 33% of the plans matched or outperformed the custom policy return of 13.78%.
  • Public plans were the leading performer for the fourth quarter, posting a median return of 5.99%, closely followed by Taft Hartley, foundations, endowments, corporate pensions and health care plans.
  • U.S. equities were the dominant asset class for the quarter with the median return of 11.79%, compared to the Russell 3000 Index return of 11.59%.  Non-U.S. equities posted 7.35% for the quarter, slightly ahead of the MSCI World ex USA Index result of 7.22%.  The median return for non-U.S. fixed income was -0.75% compared to the Citigroup Non-U.S. World Government Bond Index return of -1.45%.  U.S. fixed income was the lowest performing asset class for the quarter with a median return of -0.92%, versus the Barclays Capital U.S. Aggregate Bond Index return of -1.30%.  

"The fourth quarter was once again driven by strong performance in the equity markets, with the median return for U.S. equity up almost 12% and international markets up more than 7%," said Stewart.  "These results not only led the charge for the quarter, but also enabled both asset classes to jump ahead of fixed income, which had reported the better year-to-date returns last quarter."

The average asset allocation in the BNY Mellon U.S. Master Trust Universe for the fourth quarter was: U.S. equity 34%, U.S. fixed income 27%, non-U.S. equity 17%, non-U.S. fixed income 2%, alternative investments 10%, real estate 2%, cash 1%, and other (oil, gas, etc.) 7%.

BNY Mellon Asset Servicing offers clients worldwide a broad spectrum of specialized asset servicing capabilities, including custody and fund services, securities lending, performance and analytics, and execution services. BNY Mellon Asset Servicing provides services through BNY Mellon and other related companies.

BNY Mellon (NYSE: BK) is a global financial services company focused on helping clients manage and service their financial assets, operating in 36 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing superior asset management and wealth management, asset servicing, issuer services, clearing services and treasury services through a worldwide client-focused team. It has $25.0 trillion in assets under custody and administration and $1.17 trillion in assets under management, services $12.0 trillion in outstanding debt and processes global payments averaging $1.6 trillion per day. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation. Learn more at www.bnymellon.com.

BNY Mellon U.S. Master Trust Universe Median Plan Returns

 

Period Ending December 31, 2010

 

Universe

Number of

Participants

4Q

2010

One-

Year

Five-

Years

Ten-

Years

 

Master Trust Total Fund

698

5.60

12.89

4.54

4.85

 

   Corporate Plans

247

5.35

13.50

4.76

4.97

 

   Foundations

78

5.94

12.87

4.54

5.10

 

   Endowments

79

5.85

12.59

5.21

5.25

 

   Public Plans

119

5.99

13.21

4.44

4.90

 

   Taft-Hartley Plans

64

5.97

12.77

3.66

4.33

 

   Health Care Plans

14

3.94

11.32

4.09

N/A

 

Universe Custom Composite Benchmark


 

8.06

13.78

3.45

3.05

 
           


 

Russell 3000 Index: Russell Investment Group is the source and owner of the Russell Indexes and all trademarks and copyrights related to its indexes.

Barclays Capital U.S. Aggregate Bond Index: © Barclays Bank PLC 2011.  This data is provided by Barclays Bank PLC all rights are reserved.

Citigroup Non-US World Government Bond Index: © Citigroup Global Markets Inc., 2011. All rights reserved.

MSCI: Copyright MSCI 2011.  Unpublished.  All Rights Reserved.