Key Takeaways
- • The Arkansas Public Employees Retirement System's investment portfolio rose by more than $1.8 billion in fiscal 2026 to $14.282 billion as of June 30, up from $12.409 billion a year earlier, according to system records.
- • The system earned an 18% investment return in fiscal 2026, ranking among the top 5% of peer public pension systems, according to Chief Investment Officer Carlos Borromeo.
- • Domestic stocks ($6.029 billion, 22.86% return) and international stocks ($3.198 billion, 28.79% return) drove performance, per Borromeo and investment consultant Meketa Investment Group.
- • Unfunded liabilities fell by $400 million to $2.02 billion on June 30, based on actuarial accrued liabilities of $14.51 billion, per actuary Gabriel, Roeder, Smith & Co.
- • Trustees will consider in December whether to cut the employer contribution rate from 15.32% to 13.14% of payroll for fiscal 2029.
Summary
The Arkansas Public Employees Retirement System (APERS) reported that its investment portfolio increased by more than $1.8 billion during the fiscal year ended June 30, 2026, reaching $14.282 billion, according to system records reported by the Arkansas Democrat-Gazette. Chief Investment Officer Carlos Borromeo told the board of trustees that the system earned an 18% return in fiscal 2026, placing it among the top 5% of peer public pension systems. Borromeo said the portfolio was valued at $14.288 billion as of the Tuesday before the board meeting.
According to Borromeo, domestic stock investments totaled $6.029 billion on June 30 after returning 22.86% in fiscal 2026, while international stock investments totaled $3.198 billion after a 28.79% return. Private markets, including private equity and hedge funds, totaled $698 million with a 13.84% return. Credit investments totaled $2.403 billion and earned 4.68%, and real assets totaled $1.82 billion with a 6.21% return. Meketa Investment Group's Collin Kowalski said equity performance drove results for the year.
Meketa reported that the system's investment return has averaged 13.1% a year over three years, ranking in the top 12% of public pension systems with at least $10 billion in assets, and 7.09% a year over five years, ranking in the top 48%. The system's target return is 7% a year, compared with a 6.91% average target among public pension systems per the National Association of State Retirement Administrators.
Actuary Gabriel, Roeder, Smith & Co. said trustees could reduce the employer contribution rate from 15.32% to 13.14% of payroll in fiscal 2029; trustees will decide during their December meeting. Trustee Barry Moehring cautioned against cuts that could later require increases, and trustee Larry Walther emphasized continued progress toward eliminating unfunded liabilities. In fiscal 2026, employers contributed $392.1 million and working members contributed $136.1 million. Under a 2021 state law, the employee contribution rate rises 0.25% each July 1 until reaching 7% in 2029.
According to Borromeo, domestic stock investments totaled $6.029 billion on June 30 after returning 22.86% in fiscal 2026, while international stock investments totaled $3.198 billion after a 28.79% return. Private markets, including private equity and hedge funds, totaled $698 million with a 13.84% return. Credit investments totaled $2.403 billion and earned 4.68%, and real assets totaled $1.82 billion with a 6.21% return. Meketa Investment Group's Collin Kowalski said equity performance drove results for the year.
Meketa reported that the system's investment return has averaged 13.1% a year over three years, ranking in the top 12% of public pension systems with at least $10 billion in assets, and 7.09% a year over five years, ranking in the top 48%. The system's target return is 7% a year, compared with a 6.91% average target among public pension systems per the National Association of State Retirement Administrators.
Actuary Gabriel, Roeder, Smith & Co. said trustees could reduce the employer contribution rate from 15.32% to 13.14% of payroll in fiscal 2029; trustees will decide during their December meeting. Trustee Barry Moehring cautioned against cuts that could later require increases, and trustee Larry Walther emphasized continued progress toward eliminating unfunded liabilities. In fiscal 2026, employers contributed $392.1 million and working members contributed $136.1 million. Under a 2021 state law, the employee contribution rate rises 0.25% each July 1 until reaching 7% in 2029.
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