Ensign Peak’s public portfolio is now valued at $46.2 billion.
(AP Photo/Rick Bowmer, File)The Church of Jesus Christ of Latter-day Saints sees it main publicly reported investment portfolio grow to $46.2 billion.
| May 16, 2023, 11:57 a.m.
The Church of Jesus Christ of Latter-day Saints’ prominent investment fund, which has become the subject of widespread public scrutiny, swelled to $46.2 billion in the first three months of 2023.
Monday’s report from Ensign Peak Advisors, the faith’s investment arm, to the U.S. Securities and Exchange Commission shows the Utah-based faith’s immense account of stocks and mutual funds shot up by $1.8 billion as of March 31, a 4.1% jump over its December levels.
The disclosure marked the second consecutive quarter of billion-dollar increases for the publicly reported portfolio after three straight quarterly declines.
Investments held in Ensign Peak climbed to a two-year high of $52.3 billion in value at the end of 2021, before rising interest rates, the Russian-Ukrainian war and market volatility sent returns tumbling. The account’s value slid to $40.3 billion as of last September before regaining ground.
The latest 4.1% gain in the first three months of 2023 fell short of the 7.5% leap posted by the S&P 500 index for the same quarter.
Ensign Peak is still $16.3 billion higher than the $29.9 billion it held in early 2020 after markets caved with the onset of the COVID-19 pandemic.
LDS Church gained $1.8 billion on its investments in Q1
Under SEC rules, Ensign Peak must disclose some investments such as U.S.-listed stocks. Thus, these public reports do not reflect the portfolio’s total holdings.
The new filing indicates the Ensign Peak portfolio held 1,772 separate stocks, mutual funds and other investments in the first quarter, winnowed by its managers from as many as 2,210 positions at the start of 2022.
The fund’s two largest holdings — in technology giants Apple and Microsoft — amount to $2.6 billion and $2.2 billion in value, respectively, the latest report indicates. The account also holds a total of $1.4 billion in two flavors of shares in Alphabet, parent company of Google.
Ensign Peak’s largest nontechnology holdings included UnitedHealth Group, at $999.9 million; $808 million in Exxon Mobil; and $710 million in Mastercard.
In February, the worldwide church and Ensign Peak agreed in an SEC settlement to pay a total of $5 million in penalties for failing to disclose the full scope of past holdings and for creating shell companies that authorities said were meant to obscure those investments and church control over them.
Monday’s government filing also comes as Ensign Peak is drawing even more attention after a “60 Minutes” episode broadcast Sunday on church finances.
A segment of the popular newsmagazine show, titled “The Church’s Firm,” featured former senior Ensign Peak portfolio-manager-turned-IRS-whistleblower David A. Nielsen and his allegations that the fund stockpiled upward of $100 billion in violation of its tax-exempt status.
“I thought I was going to work for a charity,” Nielsen said, adding that the funds instead “were never used for that. ... We just grew the bank account.”
Church officials called the broadcast “unfortunate” and labeled Nielsen’s assertions “unfounded allegations.”
Latter-day Saint leaders view the Ensign Peak fund as a “rainy day” account to buffer the global religion of 17 million members from economic downturns and to help pay for its ministerial, philanthropic, educational and missionary works around the world.
Editor’s note • This story is available to Salt Lake Tribune subscribers only. Thank you for supporting local journalism.
This article delves into the financial disclosures of Ensign Peak Advisors, the investment arm of The Church of Jesus Christ of Latter-day Saints (LDS Church). As someone deeply entrenched in finance and investment analysis, this topic aligns perfectly with my expertise.
Ensign Peak Advisors' disclosed portfolio has surged to $46.2 billion in value, a significant increase of $1.8 billion in the first quarter of 2023. This growth comes after a period of fluctuation influenced by various factors such as rising interest rates, geopolitical conflicts like the Russian-Ukrainian war, and market volatility. Despite experiencing declines, the fund's value rebounded to $46.2 billion.
The disclosed portfolio mainly consists of stocks and mutual funds, with a reported 4.1% increase in the first three months of 2023. However, it's important to note that this growth falls short of the S&P 500 index's 7.5% leap for the same quarter, indicating some divergence in performance.
Ensign Peak Advisors' disclosed holdings include significant investments in technology giants like Apple and Microsoft, each valued at billions of dollars, as well as substantial shares in Alphabet (Google's parent company). Additionally, the fund holds notable positions in companies such as UnitedHealth Group, Exxon Mobil, and Mastercard.
Despite this disclosure, it's crucial to recognize that Ensign Peak's public reports do not reveal its entire portfolio. SEC regulations necessitate the disclosure of certain investments, excluding the full scope of their holdings. Furthermore, recent scrutiny arising from an SEC settlement and allegations by a former Ensign Peak portfolio manager turned IRS whistleblower, David A. Nielsen, has drawn attention to the fund's actions.
Nielsen's allegations claim that the fund accumulated over $100 billion, potentially violating its tax-exempt status. However, church officials have dismissed these claims as baseless, maintaining that the Ensign Peak fund serves as a reserve for the LDS Church's global activities, philanthropy, and missionary endeavors, aiming to shield the church from economic downturns.
This intricate interplay between financial stewardship, regulatory compliance, and the perception of charitable intent underscores the complexities within the realm of institutional investment and nonprofit organizations, offering a rich landscape for analysis and discussion.
As for the concepts in play here, we're dealing with investment portfolio management, financial disclosure regulations set by the SEC, market volatility, geopolitical influences on investments, the S&P 500 index as a benchmark, diverse investment strategies encompassing technology and non-technology sectors, whistleblower allegations, tax-exempt status and compliance, and the role of reserves in nonprofit organizations' financial strategies.
