By Jerry Love, Director of Planned Giving
ALEXANDRIA (LBM) – Reports of a strong third quarter, the election of new officers, the addition of a new manager for the domestic equity pool and beefed up security against potential cyberattacks highlighted the Oct. 23 agenda of the final 2018 meeting of the Louisiana Baptist Foundation Board of Trustees.
THIRD QUARTER RESULTS
Lee Morris with Graystone Consulting reviewed the Foundation’s portfolio for the quarter, presenting a positive view of asset performance for the period. The increase in the portfolio was led by growth-oriented companies, primarily in the technology sector; and, fixed income investments also performed in line with expectations, he said. Alternative allocations, financial instruments other than standard stocks and bonds, also are adding value at both the performance and diversification/risk control levels.
LBF portfolio year-to-date performances as of Sept. 30:
— Short Term Fund: 1.30% actual annualized yield;
— Group Investment Fund, comprised of various market sectors: 2.87% total return;
— Diversified Income Fund, conservative income-oriented fund: 0.16% total return.
All funds are generating returns that are in line with their respective benchmarks and are adhering to the investment policies established by the LBF Board, Morris said. The net assets under management stand at $161,300,837 as of the end of September.
Although the fourth quarter has started with a correction in the markets, Morris said his firm’s Global Investment Committee continues to prefer equity securities over fixed income. The GIC feels there are opportunities for growth for equities in Japan, Europe, U.S. and emerging markets, in that order. Economic news for the United States is positive and is expected to be so for the near future, he told trustees.
The forecast return for fixed income portfolios is coupon or less in returns, Morris said, noting that the GIC anticipates the Federal Reserve may raise rates 3-4 times in the next 12 months, and projects the ten-year yield to move up to 3.25 percent by year’s end.
Morris noted that the LBF’s preferred portfolio is positioned to protect against the move up in rates by having a substantial percentage (60 percent, plus) invested in floating rate preferred stocks.
Trustees approved Morris’ recommendation that Alkeon Capital Management be added as a new manager in the Domestic Equity pool.
In other business, trustees approved an operating budget for 2019 of $887,085; and, approved adding one million dollars in cybersecurity insurance for the LBF to help mitigate any negative impact of cyberattacks or data compromise on the LBF computer systems.
The Board also approved the hiring of U.S. Computers to update and rewrite the existing accounting system on a web based platform as a means to provide longevity to the current system and offer potential for expanded services to clients in the future.
Two Trustees, Stewart Holloway and Steve Crosby, completed 6 years of service to the Foundation and finished their terms with the Board. Executive Director Wayne Taylor expressed his appreciation for the commitment, leadership and time they both devoted to LBF. Taylor noted two new trustees – James Hampton of Belcher Baptist Church, Belcher and Chad Hardbarger of Emmanuel Baptist Church, Shreveport – were approved at the annual meeting on Nov. 13.
Trustees elected Gray Kitchens, First Baptist Church, Bossier City, as president; John Carroll, First Baptist Church, Columbia, as vice president; and, Polly Brinker, Kingsville Baptist Church, Ball, to an additional term as secretary.
The next LBF trustee meeting is scheduled for Feb. 5, 2019.
The Louisiana Baptist Foundation assists individuals with gifts that benefit Louisiana Baptist churches and ministries, and to assist Baptist churches and entities with financial management. To learn more about the work and ministry of the Foundation, to review investment returns for its managed funds, or to see a list of current trustees, go to www.LBFinfo.org.