By Jerry Love, Director of Planned Giving
ALEXANDRIA – The Louisiana Baptist Foundation Board of Trustees met for its regular quarterly Trustees meeting on Feb. 3.
This is the first of four meetings for the Board for this year.
The majority of board members are returning, continuing in the first term commitment or finishing a second 3 year term. The Trustees welcomed its only new member for this year, Terry Shirley of DeRidder.
Shirley has served the Foundation board in the past from 2002 through 2007.
During the morning Investment Committee meeting, the various portfolios of the Foundation were reviewed in respect to performance and potential adjustments to asset allocation.
Barbara Bell led a review of the financial assets under management. As of December 31, 2014 the total assets managed by the LBF are $169,367,256.31 held in 2099 accounts on behalf of Baptist churches and ministries.
Over the past ten years the assets held by the foundation have increased by 63.5% from $103,575,660 at the end of 2004.
Lee Morris of Graystone Consulting, the LBF’s investment consultant, was present for the meeting and delivered his performance summary as well as general expectations for the coming year.
Morris began his comments by noting that the performance of the LBF’s Group Investment Fund was in the upper echelon of similar diversified portfolios.
Most of the portfolios invested in a similar manner ranged from 1% to 5% for the year. The Group Investment Fund (Group) ended the year with a total return of 5.8%.
Reasons for the stronger performance of the Group were the emphasis on more domestic equities during the year and investments in non-traditional securities.
Domestic equities outperformed international equities significantly, boosting the performance of the fund. Also the continued strategy of investing a portion of the overall portfolio in non-traditional investments (master limited partnerships, preferred stocks, convertible securities, and other alternatives to traditional stocks and bonds) added value with a return of 9.16% for that segment.
In light of expectations for the coming months, Morris recommended a shift towards international investments and decreasing exposure to U.S. stocks.
Morris also made a recommendation to make a minor change in the equity managers to remove two who were not meeting expectations and to help facilitate the shift from domestic to international.
Also attending the meeting were representatives from Weaver C. Barksdale & Associates, Inc., one of the Foundation’s fixed income managers.
Chuck Webb, Deena Raja and Ann Roberts reported on their strategy for staying the course relative to interest rates for last year. They expect the same strategy will enhance the portfolio for the majority of 2015.
The returns for the major components of the LBF portfolio for the year ending 2014 are as follows:
Short Term Fund: 0.43% Annualized Yield
Fixed Income Fund: 3.91% Total Return
Equity Fund: 5.66% Total Return
Non-Traditional Segment: 9.16% Total Return
The Group Investment Fund which is comprised of the segments above returned 5.80% for the year.
The Investment Committee approved motions to reflect the change in managers suggested by Lee Morris and a slight change in the Short Term Fund policy that would allow the managers slightly more latitude when selecting assets.
The Operating Committee heard reports on the LBF budget and its activities related to donations to the Foundation in its morning meeting.
Also Bell, CPA and Controller for the LBF, reviewed the 2014 budget.
Despite a 4 percent decline in Cooperative Program revenue for the year, the Louisiana Baptist Foundation ended the year well in the black primarily due to an increase in fee-based income from the additional assets under management.
The first quarter Operating Budget for 2015 will be reviewed at the Board’s next meeting in April.
Executive Director Wayne Taylor and Bell gave an update to the committee on the progress of implementing new accounting software. The conversion of data from the old system to the new is underway. The changeover, along with the necessary system checks, should be completed later this spring.
Planned Giving Director Jerry Love reported on donors who utilized the Foundation to support Baptist churches and ministries.
The Foundation is pleased to acknowledge the largest annual total contribution amount on record at $10,152,427.
Much of the total, approximately $5 million, came in the form of a specific type of gift called a Donor Advised Fund (DAF). There were 8 new DAF’s created and 14 contributions to existing accounts.
The Donor Advised Fund allows a donor to make a current tax-deductible donation to the Foundation while retaining the ability to advise how the funds are used to support Baptist ministry at a future date.
The Operating Committee acknowledged the reports, with no motions or recommendations coming from the session.
Following lunch, the entire Board met to consider the business brought by the committees.
They heard the report from the Investment Committee, and approved the motions regarding the change in managers and the Short Term Fund policies. The Board also acknowledged the report brought by the Operating Committee.
In additional business, the Board met with and hired James A. (Jay) Bolen as its attorney.
Bolen is an Alexandria-based attorney with broad experience as a trial lawyer and corporate attorney. He has a long history of community service in the central Louisiana area. He and his wife are active members of Emmanuel Baptist Church in Alexandria.
Also the LBF Board approved the spending policy for the endowment funds it manages. The rate to be paid from endowments for 2015 is 2.23 percent.
The Foundation was established in 1944 to encourage and assist individuals with gifts in support of Louisiana Baptist churches and ministries, as well as provide asset management for the churches and institutions affiliated with the LBC.
To learn more about the work and ministry of the Louisiana Baptist Foundation, to see a list of current Trustees or to review investment returns for the LBF managed funds, go to www.LBFinfo.org.
The Board’s next scheduled meeting is April 28.