US - Educational pension fund group TIAA-CREF says it may consolidate some retail funds into its institutional offering.
The move would come as part of a “broader effort” to restructure its mutual fund offerings. It also asked shareholders to approve management fee increases.
It said it is looking at consolidating the retail TIAA-CREF Mutual Funds with the TIAA-CREF Institutional Mutual Funds “in the near future”.
It said: “If and when this proposed consolidation is approved, the TIAA-CREF Mutual Funds would be merged into a corresponding TIAA-CREF Institutional Mutual Fund and would become subject to the fee and expense structure of that fund.”
Investment research firm Morningstar has criticised TIAA-CREF, saying its management fees would more than quadruple under the new plan.
“A venerable firm could be kissing its biggest advantage goodbye,” said Morningstar analyst Christopher Davis in a commentary.
He said that current TIAA-CREF investors would have to give up a portion of their returns to fund the firm's asset growth under the proposed fee scheme.
In May the pension giant’s chief financial officer Elizabeth Monrad stepped down because she was being investigated in relation to the General Re affair.