The California Public Employees’ Retirement System (CalPERS) just announced a temporary pullback of shares of four financial institutions in its Securities Lending Program: Goldman Sachs, Morgan Stanley, State Street, and Wachovia. “We want to do our part and help mitigate the current instability of the market and any potential adverse short-selling impact on these important financial institutions,” said Anne Stausboll, interim CIO of the $220 billion pension fund, in a statement.
“We will continue to monitor the situation and remain in close communication with agents and our borrowing counterparts. We anticipate lifting these loan restrictions once the market volatility abates,” Stausboll said.
CalPERS began its Securities Lending Program in the early ’80s. It lends securities to borrowing institutions to earn income on its portfolios.