TIAA-CREF shareholders have approved the merger of 11 of its retail funds into institutional portfolios, The Wall Street Journal reports. Fees on six of the funds will rise, while the remaining five funds will see their fees decrease slightly.
TIAA-CREF said it merged the funds because it hadn’t priced the retail funds properly and, therefore, had been losing money on them. “We have been incurring substantial losses on our mutual fund business since the retail funds were launched in 1997,” said TIAA-CREF spokesman Chad Peterson. In fact, TIAA-CREF Chief Executive Officer Herb Allison said the funds have cost the company $100 million over the past decade.
TIAA-CREF has taken the heat in recent years for increasing fees.