In a move to cut fees charged to Baltimore's retirement system, the city's Board of Estimates approved the transfer of nearly $3 billion in accounts this week from Mercantile Safe-Deposit and Trust Co. to Pittsburgh-based Mellon Bank.
Under the new contract, Mellon Bank will manage the assets from the Employees' Retirement System, the Fire and Police Retirement System and the Elected Officials' Retirement System.
The retirement systems serve about 27,000 active and retired workers.
City Comptroller Joan M. Pratt said Mercantile, which had held the management contract for 21 years, was too costly because the Baltimore-based bank had to hire subcontractors for some of its services.
The comptroller said Mellon Bank offered its management services for about half of what Mercantile charged.
"We needed a custodian bank to provide full services," Pratt explained.
"Now we're getting all of the services that we want and it's costing us about 50 percent less," she said.
Thomas Taneyhill, the retirement system's administrator, said the switch to Mellon Bank will save the pension fund about $300,000 a year -- down from $600,000 annually. Mellon's contract will begin March 1 and run through 2004.
Pub Date: 2/20/99