Exodus Continues at MassPRIM, CIO Stanley Mavromates Departs for Mercer

And Mavromates makes three. That’s the number of senior investment personnel that the $50 billion Massachusetts Pension Reserves Investment Management Board has lost within the last year. The latest to leave is Stanley Mavromates Jr., the pension’s chief investment officer since 2005. He announced he is joining Mercer, the Marsh & McLennan-owned consulting firm, as its chief investment officer, in late June.

Mavromates has been a key figure in MassPRIM’s efforts over the last several years to boost contributions to alternative investments, including private equity. As of April 30, MassPRIM had $5.7 billion in invested private equity capital, or 11.4 percent of its portfolio. That’s 1.4 percent over its 10 percent private equity target.

MassPRIM returned 22.3 percent in fiscal 2011, which is among the nation’s best returns for public pensions. That same year, its private equity program returned 17.1 percent.

“Stan [Mavromates] has been a major defining characteristic for PRIM over the course of the past decade-plus, and in a very positive way, and Stan has not only contributed tremendously to PRIM’s great performance and success, but has also contributed tremendously to PRIM’s positive culture,” MassPRIM Executive Director Michael Trotsky wrote in a note to staff.

Mavromates joined MassPRIM in 2000 as a deputy chief investment officer in February 2000, according to his LinkedIn profile. He held that position until March 2005, when he was promoted to CIO. Before joining MassPRIM, Mavromates spent 11 years as an investment officer at John Hancock Life Insurance Co., his profile states.

Mavromates’s departure could be another casualty of the inferior compensation typically available at public pension systems compared to similar opportunities in the private sector. At MassPRIM, the compensation issue was apparently severe enough that the system formed a compensation committee specifically to find ways to boost pay and incentives.

Mavromates did not respond to calls seeking comment on his departure.

His decision to leave MassPRIM adds to the growing number of vacancies among CIO roles at the nation’s largest pension funds. Among the pensions still looking to fill CIO positions are the $140 billion New York State Common Retirement Fund, the $73 billion Oregon Investment Council, the $72 billion North Carolina Retirement Systems, the $25 billion South Carolina Retirement System and the $11 billion Los Angeles City Employees’ Retirement System.

Mavromates departure follows those of two other key members of MassPRIM’s private equity team: Wayne Smith, who had headed the private equity portfolio, and his deputy, Michael Langdon. Smith went to Pathway Capital Management and Langdon to Hermes Global Private Equity.

Gregory Roth is a senior editor at Buyouts Magazine and peHUB. Follow his tweets @RothReuters. Follow Buyouts tweets @Buyouts.

Image credit: Photo of Beacon Hill courtesy of Shutterstock.