[Peace-discuss] Fwd: [SRRTAC-L:9355] TIAA-CREF Sells Its World Bank Bonds, Says for 'Market' Reasons (fwd)

[Al Kagan]

>Date: Tue, 12 Nov 2002 18:23:19 -0500 (EST)
>From: Frederick W Stoss <fstoss at buffalo.edu>
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>To: SRRT Action Council <srrtac-l at ala.org>
>Subject: [SRRTAC-L:9355] TIAA-CREF Sells Its World Bank Bonds, Says 
>for 'Market' Reasons
>  (fwd)
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>---------- Forwarded message ----------
>Date: Tue, 12 Nov 2002 15:47:15 -0500
>From: Jean E Dickson <dickson at BUFFALO.EDU>
>Reply-To: UB Libraries Distribution List <UBLIB-L at LISTSERV.BUFFALO.EDU>
>perhaps interesting to some of you
>---------- Forwarded message ----------
>
>The story below confirms that TIAA-CREF, the largest private pension system
>in the US, has sold all its World Bank bonds in the past year. This an
>important victory for people around the world challenging environmentally
>and socially destructive World Bank policies and projects.
>
>TIAA-CREF's action also sends a signal to other pension funds and
>institutional investors about investing in the World Bank. In the article
>below, TIAA-CREF claims to have sold World Bank bonds because their
>"returns were not as attractive as other investments." This financial
>justification for not investing in World Bank debt may be an additional
>argument to use when approaching institutional investors about the boycott,
>coupled with the strong moral and political reasons that investors should
>avoid World Bank bonds.
>
>For more information on the World Bank Bonds Boycott and all the latest
>campaign news, see www.worldbankboycott.org.
>
>
>++++++++++++++++++++++
>
>http://www.globalethicsmonitor.org
>
>TIAA-CREF says it sold World Bank bonds for market, not moral reasons
>November 06, 2002
>
>WASHINGTON (AFX-GEM) - The largest US pension system confirmed Wednesday it
>has dropped World Bank bonds from its portfolio but said the decision was
>driven by investment considerations, not protest by groups who say the
>bonds are environmentally and socially destructive.
>
>"We have held World Bank bonds and we no longer do," TIAA-CREF spokesman
>Patrick Connor told AFX Global Ethics Monitor. Individual pension
>participants and activist groups had pressed the institution to divest,
>saying the bonds financed World Bank policies and projects that harmed the
>environment and drove down wages in developing countries, Connor said.
>
>But, he added: "The only reason we don't have them now is that the returns
>would not be as attractive as other investments."
>
>Connor was reacting to statements by the World Bank Bonds Boycott Campaign,
>a network of activists who said seven mln usd worth of bank bonds had
>"disappeared" from TIAA-CREF's books and who attributed this to activist
>pressure.
>
>"There is a real possibility that, after receiving hundreds of letters,
>faxes, phone calls and e-mails, not to mention an impassioned plea to get
>out of World Bank bonds at their November 2001 annual meeting, they decided
>to quietly sell," said Neil Watkins, a boycott coordinator at the
>Washington-based Center for Economic Justice.
>
>The sums involved were relatively small, he acknowledged. TIAA-CREF has
>some 275 bln usd in assets under management and the World Bank had some 110
>bln usd in outstanding borrowings as of June 30.
>
>Nevertheless, given the 2.5-million-participant pension system's
>prominence, Watkins said he hoped the decision to sell would make an
>impression on other institutional investors.
>
>Connor, however, said that while some activists had urged TIAA-CREF to
>divest, "if you go back far enough, we've been criticized for not investing
>more in World Bank bonds by people who say the
>bank does good, not bad."
>
>Watkins had been researching TIAA-CREF's holdings as part of an effort to
>mobilize a fresh round of participant pressure to dump the bonds ahead of
>the pension system's Nov 7 annual meeting.
>
>The institution's 2001 list of investments included some five mln usd worth
>of bank bonds in the CREF Bond Market account; one mln usd in its Mutual
>Fund Bond Plus fund; and one mln usd in its
>Institutional Bond fund.
>
>But the bonds were "nowhere to be found" in the pension provider's June
>2002 semi-annual report, he said.
>
>Two of the funds held bank bonds maturing in 2006 and the third, in 2010,
>he added.
>
>The World Bank, which issued its first bond in 1947, said that in most
>markets, its debt instruments offer "a considerable yield pick-up over
>government bonds while providing the reassurance of a
>AAA-rating and the backing of the World Bank¥s shareholders," namely its
>member governments.
>
>"World Bank debt securities are included in virtually all main
>international bond indices that investors utilize as benchmarks for
>managing their portfolios," the lending agency added in a
>statement.
>
>During fiscal 2002, which ended on June 30, it issued 22 bln usd worth of
>debt securities. It expected to issue less than 20 bln usd in bonds during
>fiscal 2003.
>
>A number of leading US labor unions and a handful of cities have agreed to
>boycott the bank's bonds, as have socially responsible investment firms
>with combined assets under management of more
>than 16 bln usd.
>
>The boycott is aimed at forcing the bank to cancel its debt claims against
>poor countries, back away from privatization and macroeconomic austerity
>programs, and stop funding oil, gas, mining and
>dam projects. abid.aslam at afxnews.com
>
>________________________________________________________________
>Copyright © 2002 Agence France-Presse Group All Rights Reserved
>Global Ethics Monitor is a service of AFX News, London and Agence
>France-Presse (AFP). AFX News, is a wholly owned subsidiary of AFP,
>providing
>global news coverage of financial markets, companies and economies to
>professional and private investor communities. Agence France-Presse delivers
>news and information in six languages across all major media platforms from
>bureaus and correspondents in 165 countries. Its clients include most of the
>world's major media organizations as well as corporations and government and
>international agencies. Service Terms and Conditions are posted on the
>AFXGlobal Ethics Monitor Website.
>
>
>+++++++++++++++++++
>Neil Watkins
>World Bank Bonds Boycott
>Center for Economic Justice
>733 15th Street, NW, Suite 928
>Washington, DC 20005
>Tel: (202) 393-6665
>Fax: (202) 393-1358
>Web: www.worldbankboycott.org
>
>
>
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-- 


Al Kagan
African Studies Bibliographer and Professor of Library Administration
Africana Unit, Room 328
University of Illinois Library
1408 W. Gregory Drive
Urbana, IL 61801, USA

tel. 217-333-6519
fax. 217-333-2214
e-mail. akagan at uiuc.edu