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Home > Library > Stable Times > Volume 3, Issue 3
The quarterly publication of the Stable Value Investment Association
Third Quarter 1999 • Volume 3 Issue 3
Getting the Work Done: A Look at SVIA's Committees
By Allan Fen, Fen Associates & Gina Mitchell, SVIA
SVIA has six committees which
direct the Association's work. This article provides you with an overview
of their make-up and key activities.
Getting the Word Out
SVIA's Communications & Education Committee is responsible for spreading
the gospel on stable value funds. It's a simple message that is repeated
often by the Committee:
- Stable value provides superior
risk adjusted returns relative to other similar fixed income investments.
- Stable value is safe and provides
stability of principal and consistent earnings unlike any other investments.
- Stable value is an excellent
diversification tool for retirement savings.
Although SVIA is diligent in getting the message out, it seems to resonate
most when the equity markets slide or correct (remember last Fall's coverage
by CNN, NBC and ABC).
Most recently, the Committee has been looking for greater Internet exposure.
"We are looking to reach out to individual investors by positioning
SVIA as an investment expert and resource," explains the incoming
committee chair, Kim McCarrel. To date, SVIA is linked to
www.BlackFamilies.com
and moneycentral@msn.com.
SVIA has also been featured on other Internet publications such as the
fundforum@TheStreet.com
and www.401kWire.com.
The Committee gets the word out through its Media Team. The team serves
as a sounding board and crafts talking points for SVIA's message. The
Association's President, Gina Mitchell serves as the spokesperson. However,
the Media Team also supports her by serving as an additional resource
to the press.
The Communication & Education Committee has two other working groups
under its belt: the Stable Times Editorial Board, which is responsible
for the Association's quarterly newsletter and the Internet Group, which
is responsible for www.stablevalue.org.
Stable Times: The Resource for Stable Value Information
"Stable Times, our quarterly newsletter, demonstrates how far we
have come. The newsletter is entirely member-driven both in content and
effort," explains the Communication & Education Committee's current
chair, Kelli Hueler. "The Stable Times Editorial Group has moved
the newsletter from an internal communication vehicle for Association
members to the source for information on issues pertinent to our industry
and the trends that shape stable value for those totally new to stable
value and our members," says Hueler. "The progress that has
been made in a little more than two years is amazing. When we started
the newsletter, we were worried if there was enough content to keep it
going. Now the Editorial Group struggles to decide which stories to focus
on now and which ones can wait," states Hueler.
"However, one thing remains the same," emphasizes Hueler and
McCarrel, "Stable Times is member-driven." The newsletter and
the Editorial Group encourage and depend upon story ideas and articles
from SVIA members. So, if you have an idea or would like to write an article
for the next issue, please give SVIA's Gina Mitchell a call.
Internet Ready: www.stablevalue.org
SVIA has revamped the Association's Internet site to make it more responsive
to users. "We changed hosts, we've reorganized the site and it is
paying off," explains SVIA's Administrative Coordinator Scott Matirne.
With our old site, the .com, we averaged roughly 300 visits a month. With
our new site, www.stablevalue.org,
we are reporting between 20,000 to 25,000 visits a month, and we've only
had the new site for three months," says Matirne.
"The Stable Value Glossary seems to attract the most visitors with
the Conference Center running second," reports Matirne. Matirne predicts
that site visits will increase now that SVIA's site is listed on the top
500 browsers.
The MEMBERS' ONLY SECTION is now interactive. Matirne notes that almost
50 percent of the 1999-2000 Directory updates have been made on-line.
Additionally, key Association initiatives are now available in this section.
On the soon-to-be-added list, is an SVIA bulletin board to encourage peer-networking
and SVIA press archives.
Data & Research: The Numbers That Give SVIA Credibility
The Data & Research Committee, chaired by John Hancock's Klaus Shigley,
could be described as the "Joe Friday" of SVIA's committees
since it provides the facts -- SVIA's numbers. Through the Committee's
work on such projects as the Third Annual Stable Value Investment Policy,
key data is obtained that determines the size of the stable value market
and investment trends within the industry. These trends include duration,
credit quality and crediting rate that can be used by the membership to
determine how they compare with other stable value funds.
The Committee also oversees a joint, biannual survey with LIMRA on Product
Sales. The SVIA-LIMRA survey also collects information on funding agreements.
Shigley reports that the Committee is about to kick off the research and
development phase of the "Nifty-Fifty" stable value index. The
Committee is starting to dialogue with a hand full of plan sponsors on
the creation of the index. He explains, the Committee's idea is to track
quarterly crediting rates of the fifty largest stable value funds. The
aggregate of all fifty plans would serve as a book value index for the
industry.
Asset Allocation Task Force: Looking at Models
The Task Force is evaluating not only the proliferation of advice firms
offering asset allocation models but also how these models treat stable
value funds and who is currently using the models. The Task Force's initiative
is to educate the model providers about stable value to try to ensure
that stable value is represented and is properly portrayed.
Performance Measurement Task Force Enters Phase Two
The Data & Research Committee's Task Force on Performance Measurement
completed a major milestone: the issuance of its draft report in late
February of this year. The Report recommended using total return calculations
using fair (market) value of underlying assets, in addition to book value,
when making performance comparisons between stable value funds and with
benchmarks. "Fair value's use is common place in other asset classes,"
reports Task Force member Allan Fen. "However," he notes, "it
is starting to be for stable value with wrapped bond funds."
IBM's Dan Libby and PRIMCO's Paul Donahue will lead Phase Two of the Task
Force. A major thrust of the Task Force's work will be promoting the Task
Force Report and working to get a consensus on the use of fair value,
as one of the accepted methodologies for evaluating performance among
the different stable value constituents such as consultants, managers,
issuers and plan sponsors.
Budget, Finance and Oversight: SVIA's Newest Committee
SVIA spun-off the Committee on Budget, Finance and Oversight from the
Committee on Membership and Dues earlier this year. The new Committee,
chaired by State Street's Jim McDevitt, is responsible for overseeing
SVIA's administration and financial arrangements now that SVIA has taken
on those functions internally in the Washington Office. The Committee
is responsible for SVIA's $750,000 budget, which includes a $160,000 budget
for the 1999 National Forum.
Government Relations
The Government Relations Committee is charged with monitoring all federal
and state developments that may impact stable value funds. The Committee
Chair, Al Turco from Pepe & Hazard, reports that the Committee has
spent almost a year looking into how the Department of Labor regulates
synthetic GICs. The Committee oversaw the creation of a Working Group
and an Issuer Advisory Group on synthetics. The Working Group recently
filed an application for a Department of Labor prohibited transaction
exemption on synthetic GICs.
SVIA's Board of Directors is supportive of the proposed application and
has identified disclosure to plan participants and evergreen contracts
as key issues for SVIA's Government Relations Committee. Turco predicts
that the Committee will begin a direct dialogue with the Department of
Labor on these two issues.
Membership and Dues: Producing the Revenue for SVIA's Mission
The Committee on Membership and Dues has two complimentary goals: increasing/retaining
members and raising revenue or dues for the Association. To date, the
Membership and Dues Committee has exceeded its $300,000 target by 10%
despite implementation of a dues increase (Dues rose from $3,000 to $5,000
for service firms. However, for plan sponsors dues remained at $195.)
The Committee Chair, Deutsche Bank's Tami Pearse explains that roughly
half of the Association's revenues are dependent on dues. The rest, 37%,
comes from the Value Program, which was implemented this year. The remaining
12% will come from the 1999 Conference.
Value Program's First Year
SVIA to date, reports Pearse, we raised about 80% of the Value Program's
$220,000 hurdle. As of July 30, SVIA' Value Program members include:
- American Express
- C N A Insurance Company
- Certus Asset Advisors
- Deutsche Bank
- Diversified Financial Products, Inc.
- Dwight Asset Management
- Galliard Capital Management
- Jackson National Life
- John Hancock Financial Services
- GE Life & Annuity Assurance Company
- MBIA Insurance Corp.
- Metropolitan Life Insurance Company
- New York Life Insurance Company
- Pacific Life Insurance Company
- PRIMCO Capital Management
- Principal Life Insurance Company
- Protective Life Insurance Company
- Sanford C. Bernstein
- State Street Bank & Trust Company
- T. Rowe Price
Explains Pearse, "We have been really pleased at the generosity and
commitment of the Value Program Members to SVIA's mission. This is the
first year that we have institutionalized our outreach. Before, we raised
funds for the Association on an ad hoc basis. The Value Program members'
financial commitment to the Association has been exceeded only by the
time and effort of their professional staff in working towards achieving
the Association's goals."
1999 National Forum Steering Committee: New Opportunities, New Frontiers
The National Forum Steering Committee is responsible for SVIA's October
12-14 New Opportunities, New Frontiers Forum. The Forum will explore the
major issues before the stable value industry and the major trends that
shape the industry. The Forum focuses on mainstreaming stable value; key
defined contribution issues that affect the industry here and abroad,
global opportunities, and hands-on debate on issues such as par vs. non-par
value. To get the latest information on the National Forum, check Conference
Center at SVIA's www.stablevalue.org.
Communication & Education Committee
The Committee is defined into three working groups:
Media Team, Stable Times Editorial Board and www.stablevalue.org.
Co-Chairs
- Kelli Hueler, Hueler Companies
- Kim McCarrel, PRIMCO
Media Team
- Bill Bonacci, MetLife
- Connie Dorval, Diversified Financial Products
- Joe Fournier, John Hancock
- Jon Fraade, AIG
- Kelli Hueler, The Hueler Companies, Co-Chair
- Kim McCarrel, PRIMCO, Co-Chair
- Robert McCormish, Certus Asset Advisors
- Jason Psome, Deutsche Asset Management
- Richard Taube, Pacific Life
- Karl Tourville, Galliard Capital
Stable Times Editorial Board
- Gary Bacchiocchi, MassMutual
- Wendy Cupps, PIMCO
- Allan Fen, Fen & Associates
- Jamie Guenther, PRIMCO
- Dave Leroux, Jackson National Life
- Dan Libby, IBM
- Vicky Paradis, J.P. Morgan
- Janet Jasin Quarberg, Hueler Companies
- Karl Tourville, Galliard Capital
- Greg Wilensky, Sanford C. Bernstein
www.stablevalue.org
- Kim McCarrel, PRIMCO, Co-Chair
- Barbara McLean, ING
- Karen Watson, Baxter
Data & Research Committee
Chair: Klaus Shigley, John Hancock
- Dean Benner, Brundage, Story & Rose
- Wayne Gates, John Hancock
- Eileen Leonardi, Fidelity
- Dan Libby, IBM
- Judy Markland, Landmark Strategies
- David McNiff, Eastman Kodak
- Joe Mickelson, American Express
- Jason Psome, Deutsche Asset Management
- Ivan Rudolph-Shabinsky, Sanford C. Bernstein
- Elliot Rosenthal, GE Life & Annuity Assurance Co.
- David Wray, Profit Sharing/401(k) Council
Asset Allocation Task Force
Chair: Stephen LeLaurin, PRIMCO
- Wayne Gates, John Hancock
- Jamie Guenther, PRIMCO
- Paul Lipson, Federal Reserve Employee Benefit Systems
- Klaus Shigley, John Hancock
- Bruce Vane, Certus Asset Advisors
Performance Measurement Task Force
Co-Chairs: Paul Donahue, PRIMCO
Dan Libby, IBM
- Peter Barcia, Deutsche Asset Management
- George Baumann, PRIMCO
- Karen Chong-Wulff, DuPont
- Wendy Cupps, PIMCO
- Ty Danco, Dwight Asset Management
- Kelley Fairbank, Frank Russell
- Chris Freese, The Principal Group
- Allan Fen, Fen & Associates
- Robert Galusza, Fidelity
- Susan Graef, Vanguard
- Kathy Hyland, Vanguard
- Paul Kraft, Deloitte
- Jim McKay, American Express
- Vicky Paradis, J.P. Morgan
- Klaus Shigley, John Hancock
- Mark Shoemaker, T. Rowe Price
- Karl Tourville, Galliard Capital
Budget, Finance and Oversight Committee
Chair: Jim McDevitt, State Street Bank & Trust
- Eric Kirsch, Deutsche Asset Management
- David McNiff, Eastman Kodak
- Judy Wilson, Protective Life
Government Relations Committee
Chair: Alfred Turco, Pepe & Hazard
- Tony Camp, Aetna
- Victor Gallo, Jackson National Life
- Sandy Koeppel, Prudential
- Helen McGreevy, J.P. Morgan
- Jim McKay, American Express
- Tom Roberts, Aetna
- Christina Stiver, Transamerica
Membership & Dues Committee
Chair: Tami Pearse, Deutsche Bank
- Doris Fritz, Fidelity
- Bill Gardner, Dwight Asset Management
- Marian Marinack, Federated
- Judy Wilson, Protective Life
1999 National Forum Steering Committee
Co-Chairs: Robert Angelica, AT&T
Gina Mitchell, SVIA
- Peter Brigando, New York Life
- Joe Fournier, John Hancock
- Bill Gardner, Dwight Asset Management
- Thomas Hartlage, Diversified Financial Products
- Maryann Segreto-Lamb, C N A
- Scott Matirne, SVIA
- John Milberg, Pacific Life
- Randy Paas, PRIMCO
- Joseph Saleh, Deutsche Bank
- Ken Walker, T. Rowe Price
- Judy Wilson, Protective Life
Read Next: Tracking Stable Value Yield Spreads: Interest Rate Commentary - 06/30/99
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