The Public Pension oversight board heard testimony from the Teachers’ Retirement System of Kentucky on Monday, just days after the pension was found to have sold off shares in a Russian bank before the invasion of Ukraine.
But the pension was never the second-largest shareholder in Sberbank, said Beau Barnes, deputy executive secretary and general counsel of Teachers’ Retirement System Kentucky.
Social media posts went wild on Thursday, according to Barnes. One of those posts was from Northern Kentucky U.S. Representative Thomas Massie (R-Lewis County), who shared a post from the Market Sentiment Account.
“Those social media postings that TRS is the number two shareholder in Sberbank are completely false,” Barnes said. “TRS is not now, nor has ever been, the number two shareholder in Sberbank. Not even close. Never.”
Instead, the $15 million that TRS had invested in Sberbank was put there by an outside investment council. When that outside investment council saw that sanctions were about to be placed on Russia due to the Ukraine invasion, they sold those shares on Feb. 23.
“TRS did at one time, have a position, owned some shares, in Sberbank from 2017,” Barnes said.
The overall fund is roughly $26 billion, and Barnes noted that the $15 million that TRS had in the fund was a drop in the hat. TRS also didn’t lose funds, as indicated in the posts, as they had lost some money recently but also earned some through dividends.
“Because we were trying to get some messages out to comm folks to let them know their retirement was okay, we did include in that message, which we did update later that day, that did not include the dividend income we earned from Sberbank,” Barnes said.
Barnes said the dividend income exceeded $3 million, so TRS had a slight net gain.
But, as with most investments, it’s complicated, and that isn’t the only pool of money that TRS has in Russian investments. Barnes said that they have other investments with small slivers in Russian assets, and he would get more clarification from the pension board.
Rep. Jim DuPlessis (R-Elizabethtown) questioned the other investments and pointed out that the TRS board is made up of appointees by the Kentucky Education Association.
“I appreciate your explanation on the Russia investment, and I understand it’s a global world we live in, and your investment group decided that was a good investment, and I’m not throwing spears at it,” DuPlessis said.
He elaborated that the Kentucky Legislature nor the public pension oversight board is the body that keeps tabs on these types of investments.
“I want the people that are listening to this hearing to understand that very clearly that wasn’t the state that decided to invest in Sberbank,” DuPlessis said.