NY Pension Fund Investments in Russian Companies Frozen by Putin
By: Ilana Siyance
Russian President Vladimir Putin has frozen roughly $519 million in assets owned by city and state pension funds. As reported by the NY Post, though the New York employees and taxpayer funded pensions pledged to sell off holdings in Russian companies, to protest the country’s aggression against Ukraine, Moscow is prohibited foreign investors from dumping the stocks. “Putin is a thug and he’s holding our money hostage,” said Gregory Floyd, a Teamsters union leader and trustee of the New York State Teachers’ Retirement System (NYCERS).
New York City’s five pension systems – covering teachers, police, firefighters and other city employees – have invested a total $284.5 million in 33 publicly traded Russian stocks, as per records released to The Post by city Comptroller Brad Lander’s office. The market value of those Russian assets was $185.9 million on Feb. 25th, down almost $100 million from the purchase price, the latest available records show. Lander’s office says it’s unclear what the value of the Russian stocks is now. “The market remains closed to all non-Russian investors,” spokeswoman Shaquana Chaneyfield said. “Strong sanctions are in place that prohibit us from transacting any Russian securities. Given that context and constantly shifting rules in the Russian market, an accurate assessment of their current value is not available at this time.”
NYC pension systems have invested the biggest portion of their Moscow investment, or $133.3 million, in Sberbank—the country’s largest financial institution, which has since been sanctioned. Another $22.7 million is invested in Lukoil, Russia’s second-largest oil company. There is $14.2 million invested from the pensions into Polyus Gold- the country’s largest gold producer. Another $6.4 million of the pension system is invested in Gazprom—the Russian owned energy corporation and the world’s largest natural-gas company.
NYSTERS, which represents public-school teachers outside of NYC, passed a resolution on March 4 to divest of Russian-related assets worth $125 million. It has not, however, been able to do so. “They’re just trapped,” said John Murphy, former executive director of NYCERS. “There is a risk that they will lose all their money on these companies.”
As per the Post, even if the pensions were permitted to sell, prices now would be such that it wouldn’t make sense to do so. Overall, the city and state’s $519 million invested in Russian companies makes up only 0.1 percent of the total $263.2 billion that the city pension systems manage as of March.
