California Teachers' Group Selects CitiStreet For 403(b) Plan; CalSTRS To Provide, Pay For, Advice Platform.

Business Editors

QUINCY, Mass.--(BUSINESS WIRE)--April 2, 2002

CitiStreet, one of the nation's largest global benefits providers, has been selected to provide 403(b) services, including an advice platform, for the California State Teachers' Retirement System (CalSTRS).

The five-year contract marks the rare inclusion of an advice platform to be paid for by a teachers' group.

"Our 403(b) program is unique in the combination of advantages it provides to participants. Considering both the core funds and the self-managed account, we provide a broad choice of investment options, at a cost that is well below those charged by more traditional annuity-based plans. And the CitiStreet advice platform is one of the features we selected to help ensure our members have all the necessary resources to successfully plan for their retirement years," said Ed Derman, deputy chief executive officer, external affairs and program development at CalSTRS.

Randy Taylor, senior vice president of government markets for CitiStreet, said the inclusion of advice was groundbreaking.

"This has to be one of the first, if not the first, times in the country that a teachers' group is providing advice, and funding it, for teachers from kindergarten through community college," said Taylor.

The restructured package, which will include a new Web site and an expanded fund lineup, will immediately affect about 3,000 teachers and $60 million in assets in the CalSTRS 403(b) plan, which is called the Voluntary Investment Program and is a low-cost deferred compensation supplement to the teachers' pension plan.

"We anticipate this program, because of its unique offering in the marketplace of advice to teachers and its new array of services and funds, will add a significant number of participants," Derman said.

The program includes a core account with a primary lineup of a money market fund, an S&P 500 index fund and an equity index fund. CalSTRS will be adding eight additional funds, including three lifestyle funds that are targeted to specific retirement dates. Advice will be provided on those investments through Financial Engines, whose forecasting and advice capabilities allow high-quality, personalized advice to every employee online.

The CalSTRS program also offers a self-managed account, which permits participants to select among more than 3,000 mutual funds, including more than 500 without any transaction fee or load.

CalSTRS administers retirement, disability and survivor benefits for California's public school educators in grades kindergarten through community college, serving approximately 687,000 members and benefit recipients.

About CitiStreet

CitiStreet, one of the largest global benefits delivery firms in the United States, is headquartered in Quincy, Mass. It has 3,000 employees and offices in East Brunswick, N.J., Jacksonville, Fla., Minneapolis and Boston, and 35 field offices around the nation. It also has a division, CitiStreet Australia, with offices in Sydney and Brisbane. CitiStreet serves more than 6.5 million participants and administers approximately $200 billion in assets in the United States for defined contribution, defined benefit and health and welfare plans of corporate, government, health care, Taft-Hartley and not-for-profit organizations. It also serves about 700,000 participants and administers $1.5 billion in assets outside the United States. CitiStreet is a 50/50 joint venture between State Street Corp. (NYSE:STT) and Citigroup (NYSE:C). For more CitiStreet information, visit the Web site at www.citistreetonline.com.