THE $37 billion Victorian Funds Management Corp is on the lookout for its third chief executive in as many years, after Justin Arter quit the state-owned funds manager to run the Australian arm of global investment giant BlackRock.
Mr Arter's exit coincides with the Baillieu government ordering a greater level of oversight of VFMC and questioned its efforts to develop an in-house funds management team.
VFMC oversees investments on behalf of the state's insurance agencies, superannuation funds, hospitals and some universities.
A former Goldman Sachs banker, Mr Arter joined VFMC as chief executive in late 2009. While investment performance improved under Mr Arter, the Baillieu government pushed ahead with a review of the manager soon after it came into office a year later. The review, overseen by KPMG, probed the fund's group structure, governance, management and investment processes.
Victorian Treasurer Kim Wells said yesterday he wished Mr Arter well in his future role.
"Justin was appointed to help get the Victorian Fund Management Corporation back on track after a poor investment performance under the previous government," Mr Wells said.
VFMC's board issued a statement saying Mr Arter had been instrumental in pushing through several "important enhancements" at VFMC.
The latest performance figures show VFMC delivered net investment returns of 12.6 per cent last financial year, outperforming its industry benchmark.