PALIKIR, Pohnpei—The Trust Fund Committee of the Trust Fund for the People of the Federated States of Micronesia —also known as the Compact Trust Fund so as to distinguish it from the separate FSM Trust Fund—recently conducted its Fiscal Year 2022 fourth quarter meeting. As of September 30th, 2022, the Compact Trust Fund had a net value of $911,236,499. The Compact Trust Fund was down 11.5%, net of fees, compared to the previous Fiscal Year.
The Compact Trust Fund ended Fiscal Year 2021 with a final audited value of $999,763,600 with a weighted annual return of 22.7%. For Fiscal Year 2022, the preliminary and unaudited value was $911,236,499—approximately $88,527,101 less than the previous year—with a performance rate loss of 11.5%, net of fees, performing above the benchmark of -12.0%. The loss was due to market volatility and weak economic performance occurring globally since early 2021, resulting from the increase of inflation, central bank response to tighten monetary policy, supply chain issues, continued COVID-19-related recovery, and Russia’s brutal and unjustified war against the People of Ukraine.
It is noteworthy that the net value as of September 30th does not reflect that, on October 4th, 2022, and as consistent with the Compact of Free Association, as Amended, the U.S. contribution in the amount of $39,504,160 was received by the Compact Trust Fund and invested per the Investment Policy Statement.
The Compact Trust Fund is invested in a diversified set of assets including: U.S. domestic equity (21.5% of total assets); non-U.S. equity (19.8% of total assets); global equity (9.1% of total assets); fixed income (17.8% of total assets); hedge funds (5.8% of total assets); real estate (13.0% of total assets); and private equity (13.0% of total assets).
Citizens, residents, and stakeholders interested in the Compact Trust Fund are encouraged to visit the Compact Trust Fund’s website at: https://fsmcfatf.com/