Exhibit 5 - June 30, 2025 GASB Statement Nos. 67 and 68.pdf

Maryland State Retirement and Pension System GASB Statement Nos. 67 and 68 Accounting and Financial Reporting for Pensions June 30, 2025

October 17, 2025

Board of Trustees Maryland State Retirement and Pension System 120 East Baltimore Street, 16th Floor Baltimore, Maryland 21202

Dear Members of the Board:

This report provides accounting and financial reporting information that is intended to comply with the Governmental Accounting Standards Board (“GASB”) Statements No. 67 and 68 for the Maryland State Retirement and Pension System (“MSRPS”). These calculations have been made on a basis that is consistent with our understanding of these accounting standards.

This information is presented in draft form for review by the System’s auditor. Please let us know if there are any items that the auditor changes so that we may maintain consistency with the System’s financial statements.

GASB Statement No. 67 is the accounting standard that applies to the stand-alone financial reports issued by retirement systems. GASB Statement No. 68 establishes accounting and financial reporting for state and local government employers who provide their employees (including former employees) pension benefits through a trust.

Our calculation of the liability associated with the benefits described in this report was performed for the purpose of assisting in the reporting and disclosure information that satisfies the requirements of GASB Statements No. 67 and 68. The calculation of the System’s liability for this report is not applicable for funding purposes of the System. The Net Pension Liability is not an appropriate measure for measuring the sufficiency of plan assets to cover the estimated cost of settling the employer’s benefit obligation. The Net Pension Liability is not an appropriate measure for assessing the need for or amount of future employer contributions. A calculation of the System’s liability for purposes other than satisfying the requirements of GASB Statement No. 67 may produce significantly different results. This report may be provided to parties other than the Maryland State Retirement Agency (SRA) and the Board of Trustees only in its entirety and only with the permission of the SRA and the Board. GRS is not responsible for unauthorized use of this report.

The Total Pension Liability, Net Pension Liability, and certain sensitivity information shown in this report are based on an actuarial valuation performed as of June 30, 2024. The Total Pension Liability was rolled-forward from the valuation date to the plan year ending June 30, 2025 using generally accepted actuarial principles. It is our opinion that the recommended assumptions are internally consistent, reasonable, and comply with the requirements under GASB Statements No. 67 and 68.

This report is based upon information, furnished to us by the SRA, concerning retirement and ancillary benefits, active members, deferred vested members, retirees and beneficiaries, and financial data. If your understanding of this information is different, please let us know. This information was checked for internal consistency, but it was not audited.

Board of Trustees

October 17, 2025

This report complements the actuarial valuation reports that were provided to the SRA and should be considered collectively as a combined report for the plan year ending June 30, 2025. Please see the actuarial valuation reports as of June 30, 2024 and 2025 for additional discussion of the nature of actuarial calculations and more information related to participant data, financial data, economic and demographic assumptions, and benefit provisions.

This report was prepared using our proprietary valuation model and related software which, in our professional judgment, has the capability to provide results that are consistent with the purposes of the valuation and has no material limitations or known weaknesses. We performed tests to ensure that the model reasonably represents that which is intended to be modeled.

To the best of our knowledge, the information contained within this report is accurate and fairly represents the actuarial position of the System. All calculations have been made in conformity with generally accepted actuarial principles and practices as well as with the Actuarial Standards of Practice issued by the Actuarial Standards Board.

The signing actuaries are independent of the plan sponsor.

Brad L. Armstrong and Jeffrey T. Tebeau are Members of the American Academy of Actuaries (MAAA) and meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinions contained herein.

Respectfully submitted, Gabriel, Roeder, Smith & Company

Brad L. Armstrong, ASA, EA, FCA, MAAA

Jeffrey T. Tebeau, FSA, EA, FCA, MAAA

BLA/JTT:rmn

C3108

Table of Contents

Page Section A Executive Summary

Introduction Summary of Disclosures

Section B Financial Statements

Statement of Pension Expense under GASB Statement No. 68 Statement of Outflows and Inflows Arising from Current Reporting Period Statement of Outflows and Inflows Arising from Current and Prior Reporting Periods Recognition of Deferred Outflows and Inflows of Resources Statement of Fiduciary Net Position Statement of Changes in Fiduciary Net Position

Section C Required Supplementary Information

Schedule of Changes in Net Pension Liability and Related Ratios Current Period Schedule of Changes in Net Pension Liability and Related Ratios Multiyear Schedule of the Net Pension Liability Multiyear Schedule of Contributions Multiyear Notes to Schedule of Contributions Schedule of Investment Returns Multiyear

Section D Notes to Financial Statements

Asset Allocation Sensitivity of Net Pension Liability to the Single Discount Rate Assumption Summary of Population Statistics

Section E Calculation of the Single Discount Rate

Calculation of the Single Discount Rate Projection of Contributions Projection of Plan Fiduciary Net Position Present Values of Projected Benefit Payments

Section F Glossary of Terms

SECTION A

EXECUTIVE SUMMARY

This information is presented in draft form for review by the System’s auditor. Please let us know if there are any items that the auditor changes so that we may maintain consistency with the System’s financial statements.

Maryland State Retirement and Pension System 1

Executive Summary Introduction

Accounting Standard

For pension plans that are administered through trusts or equivalent arrangements, Governmental Accounting Standards Board (GASB) Statement No. 67 establishes standards of financial reporting for separately issued financial reports and specifies the required approach for measuring the pension liability.

Similarly, GASB Statement No. 68 establishes standards for state and local government employers (as well as non-employer contributing entities) to account for and disclose the Net Pension Liability, Pension Expense, and other information associated with providing retirement benefits to their employees (and former employees) on their basic financial statements.

The following discussion provides a summary of the information that is required to be disclosed under these accounting standards. A number of these disclosure items are provided in this report. However, certain information, such as notes regarding accounting policies and investments, is not included in this report and the retirement system and/or plan sponsor will be responsible for preparing and disclosing that information to comply with these accounting standards.

Financial Statements

GASB Statement No. 68 requires state or local governments to recognize the Net Pension Liability and the Pension Expense on their financial statements. The Net Pension Liability is the difference between the Total Pension Liability and the plan’s Fiduciary Net Position. In traditional actuarial terms, this is analogous to the accrued liability less the market value of assets (not the smoothed actuarial value of assets that is often encountered in actuarial valuations performed to determine the employer’s contribution requirement).

The Pension Expense recognized each fiscal year is equal to the change in the Net Pension Liability from the beginning of the year to the end of the year, adjusted for deferred recognition of the liability and investment experience.

Pension plans that prepare their own, stand-alone financial statements are required to present two financial statements – a statement of Fiduciary Net Position and a statement of changes in Fiduciary Net Position in accordance with GASB Statement No. 67. The statement of Fiduciary Net Position presents the assets and liabilities of the pension plan at the end of the pension plan’s reporting period. The statement of changes in Fiduciary Net Position presents the additions, such as contributions and investment income, and deductions, such as benefit payments and expenses, and net increase or decrease in the Fiduciary Net Position.

Maryland State Retirement and Pension System 2

Notes to Financial Statements

GASB Statement No. 68 requires the notes of the employer’s financial statements to disclose the total Pension Expense, the pension plan’s liabilities and assets, and deferred outflows and inflows of resources related to pensions.

Both GASB Statements No. 67 and 68 require the notes of the financial statements for the employers and pension plans to disclose certain additional information. This information includes:

Items in this report:

• The pension plan’s Fiduciary Net Position, Net Pension Liability, and the pension plan’s Fiduciary Net Position as a percentage of the Total Pension Liability;

• The Net Pension Liability using a discount rate that is 1% higher and 1% lower than used to calculate the Total Pension Liability and Net Pension Liability for financial reporting purposes;

• Significant assumptions and methods used to calculate the Total Pension Liability;

• Certain information about mortality assumptions and the dates of experience studies; and

• The type of employees and number of members covered by the pension plan.

Items in the actuarial valuation reports:

• A description of benefits provided by the plan;

• Certain information about mortality assumptions and the dates of experience studies; and

• The type of employees and number of members covered by the pension plan.

Items that should be provided by other individuals:

• A description of the plan’s funding policy, which includes member and employer contribution requirements;

• The pension plan’s investment policies;

• Long-term expected return on plan assets;

• The composition of the pension plan’s Board and the authority under which benefit terms may be amended;

• A description of how fair value is determined;

• Information regarding certain reserves and investments, which include concentrations of investments greater than or equal to 5%, receivables, and insurance contracts excluded from plan assets;

• Annual money-weighted rate of return;

• Inputs to the discount rates;

• A description of the terms of the plan’s Deferred Retirement Option Program (DROP) and the total DROP balance for those members currently participating in the DROP;

• Sources of changes in the Net Pension Liability;

• Information about the components of the Net Pension Liability and related ratios, including the pension plan’s Fiduciary Net Position as a percentage of the Total Pension Liability, and the Net Pension Liability as a percent of covered-employee payroll; and

• Comparison of the actual employer contributions to the actuarially determined contributions based on the plan’s funding policy.

Maryland State Retirement and Pension System 3

Timing of the Valuation

An actuarial valuation to determine the Total Pension Liability is required to be performed at least every two years. For employer reporting, the net pension liability and pension expense should be as of a date (measurement date) no earlier than the end of the employer’s prior fiscal year, consistently applied from period to period. If the actuarial valuation used to determine the total pension liability is not calculated as of the measurement date, the total pension liability is required to be rolled forward from the actuarial valuation date to the measurement date.

The Total Pension Liability shown in this report is based on an actuarial valuation performed as of June 30, 2024 and a measurement date of June 30, 2025.

Single Discount Rate

Projected benefit payments are required to be discounted to their actuarial present values using a Single Discount Rate that reflects: (1) a long-term expected rate of return on pension plan investments (to the extent that the plan’s Fiduciary Net Position is projected to be sufficient to pay benefits); and (2) tax-exempt municipal bond rate based on an index of 20-year general obligation bonds with an average AA credit rating as of the measurement date (to the extent that the contributions for use with the long-term expected rate of return are not met).

For the purpose of this valuation, the expected rate of return on pension plan investments is 6.80%; the municipal bond rate is 5.20% (based on the weekly rate closest to but not later than the measurement date of the “20-Bond GO Index” rate from the Bond Buyer Index); and the resulting Single Discount Rate is 6.80%.

Benefit Changes

The were no benefits changes since the previous measurement date.

Actuarial Assumption Changes

There were no assumption changes since the previous measurement date. Actuarial assumptions are consistent with the assumptions used in the funding actuarial valuation as of June 30, 2025.

Effective Date and Transition

GASB Statements No. 67 and 68 were effective for fiscal years beginning after June 15, 2013, and June 15, 2014, respectively.

Comments

Pages 25 and 26 were completed using information provided by the MSRPS investment consultant.

Maryland State Retirement and Pension System 4

Summary of Disclosures as of June 30, 2025

($ in Thousands)

Actuarial Valuation Date June 30, 2024

Measurement Date of the Net Pension Liability June 30, 2025

Plan's Fiscal Year Ending Date June 30, 2025

Employer's Fiscal Year Ending Date (Reporting Date) for GASB 68 June 30, 2026

Membership TCS ECS (State) State Police Judges LEOPS (State) ECS (Muni) LEOPS (Muni) CORS (Muni) Total MSRPS

Number of

- Retirees and Beneficiaries 84,975 65,283 2,638 471 1,899 20,125 709 71 176,171

- Inactive, Nonretired Members 23,494 16,415 85 8 174 5,787 135 1 46,099

- Active Members 115,316 59,144 1,312 322 1,589 25,804 1,404 153 205,044

- Total 223,785 140,842 4,035 801 3,662 51,716 2,248 225 427,314

Covered Payroll1 9,537,248$ 4,942,736$ 151,105$ 63,061$ 165,299$ 1,675,618$ 114,243$ 11,394$ 16,660,704$

Net Pension Liability

Total Pension Liability 57,570,333$ 27,710,472$ 3,196,900$ 790,330$ 1,631,097$ 7,142,542$ 841,676$ 63,245$ 98,946,595$

Plan Fiduciary Net Position 44,167,425 18,798,803 2,121,949 652,789 1,119,561 5,741,276 591,592 47,379 73,240,774

Net Pension Liability 13,402,908$ 8,911,669$ 1,074,951$ 137,541$ 511,536$ 1,401,266$ 250,084$ 15,866$ 25,705,821$

Plan Fiduciary Net Position as a Percentage of Total Pension Liability 76.72% 67.84% 66.38% 82.60% 68.64% 80.38% 70.29% 74.91% 74.02%

Net Pension Liability as a Percentage of Covered Payroll 140.53% 180.30% 711.39% 218.11% 309.46% 83.63% 218.91% 139.25% 154.29%

Development of the Single Discount Rate

Single Discount Rate 6.80% 6.80% 6.80% 6.80% 6.80% 6.80% 6.80% 6.80%

Long-Term Expected Rate of Investment Return 6.80% 6.80% 6.80% 6.80% 6.80% 6.80% 6.80% 6.80%

Long-Term Municipal Bond Rate2 5.20% 5.20% 5.20% 5.20% 5.20% 5.20% 5.20% 5.20%

Last year ending June 30 in the 2025 to 2124 projection period for which projected benefit payments are fully funded 2124 2124 2124 2124 2124 2124 2124 2124

1 Payroll from the June 30, 2025 valuation.

2 Source: "20-Bond GO Index" is the Bond Buyer Index, general obligation, 20 years to maturity, mixed quality. In describing this index, the Bond Buyer notes that the bonds' average credit quality is roughly equivalent to Moody's Investors Service's Aa2 rating and Standard & Poor's Corp.'s AA. The rate shown is as of June 26, 2025, the most recent rate available on or before the measurement date.

Totals may not add due to rounding.

Maryland State Retirement and Pension System 5

Summary of Disclosures

($ in Thousands)

Deferred Outflows and Deferred Inflows of Resources by Source to be Recognized in Future Pension Expenses

Total MSRPS

Deferred Inflows of Resources

Difference between expected and actual experience 324,284$

Changes in assumptions -

Net difference between projected and actual earnings on pension plan investments 1,640,537

Total 1,964,821$

Deferred Outflows of Resources

Difference between expected and actual experience 3,429,112$

Changes in assumptions 961,947

Net difference between projected and actual earnings on pension plan investments 2,237,254

Total 6,628,313$

Current Pension Expense

Total Pension Expense 3,440,246$

SECTION B

FINANCIAL STATEMENTS

This information is presented in draft form for review by the System’s auditor. Please let us know if

Maryland State Retirement and Pension System 6

Statement of Pension Expense under GASB Statement No. 68 Fiscal Year Ended June 30

($ in Thousands)

Total MSRPS

A. Expense 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016

1. Service Cost 2,043,497$ 1,877,205$ 1,739,209$ 1,604,970$ 1,431,276$ 1,422,322$ 1,358,759$ 1,321,018$ 1,308,260$ 1,284,885$

2. Interest on the Total Pension Liability 6,298,451 5,873,560 5,632,880 5,520,922 5,606,970 5,417,995 5,327,872 5,204,067 5,120,034 4,943,021

3. Current-Period Benefit Changes - 68 (5,109) - - (94) - 2,400 - -

4. Employee Contributions

(made negative for addition here) (1,130,018) (1,056,173) (963,702) (894,267) (865,738) (850,298) (807,290) (791,583) (782,689) (764,414)

5. Projected Earnings on Plan Investments (made negative for addition here) (4,575,816) (4,365,904) (4,326,387) (4,551,915) (3,992,223) (3,947,332) (3,818,255) (3,635,032) (3,393,543) (3,422,981)

6. Pension Plan Administrative Expense 58,338 50,796 46,014 42,061 48,741 41,344 39,784 33,211 27,622 28,659

7. Other Changes in Plan Fiduciary Net Position - - - (3) (1) 1 - - - -

8. Recognition of Outflow (Inflow) of Resources due to Liabilities 1,455,146 1,036,073 265,029 (95,535) (16,162) (402,635) (346,542) (172,642) (72,678) 130,945

9. Recognition of Outflow (Inflow) of Resources due to Assets (709,352) 109,289 225,471 (296,624) (1,811,413) 838,386 870,800 239,619 292,489 508,469

10. Total Pension Expense 3,440,246$ 3,524,914$ 2,613,405$ 1,329,609$ 401,450$ 2,519,688$ 2,625,128$ 2,201,058$ 2,499,495$ 2,708,584$

Maryland State Retirement and Pension System 7

Statement of Outflows and Inflows Arising from Current Reporting Period Fiscal Year Ended June 30

($ in Thousands)

Total MSRPS

A. Outflows (Inflows) of Resources due to Liabilities 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016

1. Difference between expected and actual experience of the Total Pension Liability (gains) or losses 1,666,904$ 2,559,018$ 991,681$ (927,288)$ (769,370)$ (44,609)$ (251,587)$ (671,134)$ (1,266,972)$ (311,650)$

2. Assumption Changes (gains) or losses -$ 1,004,742$ -$ -$ 3,468,353$ -$ (681,226)$ 154,328$ 130,175$ -$

3. Recognition period for Liabilities: Average of the expected remaining service lives of all employees {in years} 5.4996 5.4523 5.4418 5.4929 5.5183 5.5047 5.6820 5.7220 5.7789 5.8647

4. Outflow (Inflow) of Resources to be recognized in the current pension expense for the

Difference between expected and actual experience of the Total Pension Liability 303,095$ 469,347$ 182,234$ (168,816)$ (139,422)$ (8,104)$ (44,278)$ (117,290)$ (219,241)$ (53,140)$

5. Outflow (Inflow) of Resources to be recognized in the current pension expense for

Assumption Changes -$ 184,279$ -$ -$ 628,518$ -$ (119,892)$ 26,971$ 22,526$ -$

6. Outflow (Inflow) of Resources to be recognized in the current pension expense due to Liabilities 303,095$ 653,625$ 182,234$ (168,816)$ 489,097$ (8,104)$ (164,170)$ (90,319)$ (196,715)$ (53,140)$

7. Deferred Outflow (Inflow) of Resources to be recognized in future pension expenses for the difference between expected and actual experience of the Total

Pension Liability 1,363,809$ 2,089,671$ 809,447$ (758,472)$ (629,948)$ (36,505)$ (207,309)$ (553,844)$ (1,047,731)$ (258,511)$

8. Deferred Outflow (Inflow) of Resources to be recognized in future pension expenses for Assumption Changes -$ 820,463$ -$ -$ 2,839,835$ -$ (561,334)$ 127,357$ 107,649$ -$

9. Deferred Outflow (Inflow) of Resources to be recognized in future pension expenses due to Liabilities 1,363,809$ 2,910,135$ 809,447$ (758,472)$ 2,209,886$ (36,505)$ (207,309)$ (426,487)$ (940,082)$ (258,511)$

B. Outflows (Inflows) of Resources due to Assets

1. Net difference between projected and actual earnings on pension plan investments (gains) or losses (2,012,517)$ (50,871)$ 2,346,110$ 6,494,050$ (10,323,539)$ 2,080,691$ 530,045$ (264,361)$ (1,079,900)$ 2,925,451$

2. Recognition period for Assets {in years} 5.0000 5.0000 5.0000 5.0000 5.0000 5.0000 5.0000 5.0000 5.0000 5.0000

3. Outflow (Inflow) of Resources to be recognized in the current pension expense due to Assets (402,503)$ (10,174)$ 469,222$ 1,298,810$ (2,064,708)$ 416,138$ 106,009$ (52,872)$ (215,980)$ 585,090$

4. Deferred Outflow (Inflow) of Resources to be recognized in future pension expenses due to Assets (1,610,014)$ (40,697)$ 1,876,888$ 5,195,240$ (8,258,831)$ 1,664,553$ 424,036$ (211,489)$ (863,920)$ 2,340,359$

Maryland State Retirement and Pension System 8

Statement of Outflows and Inflows Arising from Current and Prior Reporting Periods

Fiscal Year Ended June 30, 2025 ($ in Thousands)

Total MSRPS

Outflows Inflows Net Outflows of Resources of Resources of Resources

1. Due to Liabilities 1,767,473$ 312,327$ 1,455,146$

2. Due to Assets 1,768,032 2,477,384 (709,352)

3. Total 3,535,505$ 2,789,711$ 745,794$

Outflows Inflows Net Outflows of Resources of Resources of Resources

1. Differences between expected and actual experience 954,676$ 312,327$ 642,349$

2. Assumption Changes 812,797 - 812,797

3. Net Difference between projected and actual earnings on pension plan investments 1,768,032 2,477,384 (709,352)

4. Total 3,535,505$ 2,789,711$ 745,794$

Deferred Outflows Deferred Inflows Net Deferred Outflows of Resources of Resources of Resources

1. Differences between expected and actual experience 3,429,112$ 324,284$ 3,104,828$

2. Assumption Changes 961,947 - 961,947

3. Net Difference between projected and actual earnings on pension plan investments 2,237,254 1,640,537 596,717

4. Total 6,628,313$ 1,964,821$ 4,663,492$

Year Ending Net Deferred Outflows

June 30 of Resources

2026 2,578,997$

2027 1,112,292

2028 624,554

2029 196,220

2030 151,429

Thereafter -

Total 4,663,492$

A. Outflows and Inflows of Resources due to Liabilities and Assets to be Recognized in Current Pension Expense

B. Outflows and Inflows of Resources by Source to be Recognized in Current Pension Expense

C. Deferred Outflows and Deferred Inflows of Resources by Source to be Recognized in Future Pension Expenses

D. Deferred Outflows and Deferred Inflows of Resources by Year to be Recognized in Future Pension Expenses

Maryland State Retirement and Pension System 9

Recognition of Deferred Outflows and Inflows of Resources Fiscal Year Ended June 30, 2025

($ in Thousands)

Total MSRPS

Year

Established Initial Amount

Initial

Recognition

Period

Current Year

Recognition

Remaining

Recognition

Remaining

Recognition

Period

Deferred Outflow (Inflow) Due to Differences between Expected and Actual Experience on Liabilities

2020 (44,609)$ 5.5047 (4,089)$ -$ 0.0000

2021 (769,370) 5.5183 (139,422) (72,260) 0.5183

2022 (927,288) 5.4929 (168,816) (252,024) 1.4929

2023 991,681 5.4418 182,234 444,979 2.4418

2024 2,559,018 5.4523 469,347 1,620,324 3.4523

2025 1,666,904 5.4996 303,095 1,363,809 4.4996

Total 642,349$ 3,104,828$

Deferred Outflow (Inflow) Due to Assumption Changes

2020 -$ 5.5047 -$ -$ 0.0000

2021 3,468,353 5.5183 628,518 325,763 0.5183

2022 - 5.4929 - - 1.4929

2023 - 5.4418 - - 2.4418

2024 1,004,742 5.4523 184,279 636,184 3.4523

2025 - 5.4996 - - 4.4996

Total 812,797$ 961,947$

Deferred Outflow (Inflow) Due to Differences between Projected and Actual Earnings on Plan Investments

2021 (10,323,539)$ 5.0000 (2,064,707)$ -$ 0.0000

2022 6,494,050 5.0000 1,298,810 1,298,810 1.0000

2023 2,346,110 5.0000 469,222 938,444 2.0000

2024 (50,871) 5.0000 (10,174) (30,523) 3.0000

2025 (2,012,517) 5.0000 (402,503) (1,610,014) 4.0000

Total (709,352)$ 596,717$

According to paragraph 33 of GASB Statement No. 68, differences between expected and actual experience and changes in assumptions are recognized in pension expense using a systematic and rational method over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the pension plan (active employees and inactive employees) determined as of the beginning of the measurement period.

At the beginning of the measurement period, the expected remaining service lives of all active members was 2,350,056 years. Additionally, the combined plan membership (active employees and inactive employees) was 427,314. As a result, the average of the expected remaining service lives for purposes of recognizing the applicable deferred outflows and inflows of resources established in the measurement period is 5.4996 years.

Additionally, differences between projected and actual earnings on pension plan investments should be recognized in pension expense using a systematic and rational method over a closed five-year period. For this purpose, the deferred outflows and inflows of resources are recognized in the pension expense as a level dollar amount over the closed period identified above.

Maryland State Retirement and Pension System 10

Statement of Fiduciary Net Position

($ in Thousands)

Total MSRPS

Assets

Cash & Cash Equivalents 2,634,052$

Receivables

Contributions:

Employers 109,370$

Employers - long term -

Members 17,095

Accrued investment income 348,529

Investment sales proceeds 873,994

Total Receivables 1,348,988$

Investments, at fair value

U.S. Government obligations 5,951,405$

Domestic corporate obligations 2,833,899

International obligations 1,717,550

Domestic stocks 11,967,671

International stocks 11,697,783

Mortgages & mortgage-related securities 2,167,944

Alternative investments 33,881,371

Collateral for loaned securities 5,074,047

Total Investments 75,291,670$

Total Assets 79,274,710$

Liabilities

Payables

Accounts payable & accrued expenses 69,816$

Investment commitments payable 890,073

Obligation for collateral for loaned securities 5,074,047

Total Liabilities 6,033,936$

Net Position Restricted for Pensions 73,240,774$

Maryland State Retirement and Pension System 11

Statement of Changes in Fiduciary Net Position for Year Ended June 30, 2025

($ in Thousands)

TCS ECS (State) State Police Judges LEOPS (State) ECS (Muni) LEOPS (Muni) CORS (Muni) Total MSRPS

Additions

Contributions

Employer 1,429,515$ 1,061,020$ 130,757$ 29,998$ 73,275$ 178,341$ 42,714$ 1,834$ 2,947,454$

Employee 671,715 329,180 11,914 4,389 12,966 92,691 6,610 553 1,130,018

Total Contributions 2,101,230$ 1,390,200$ 142,671$ 34,387$ 86,241$ 271,032$ 49,324$ 2,387$ 4,077,472$

Net Investment Income 3,975,544$ 1,688,995$ 190,101$ 59,008$ 99,135$ 519,671$ 51,638$ 4,241$ 6,588,333$

Transfers and Rounding Adjustments -$ 3,750$ 224$ -$ 931$ -$ -$ -$ 4,905$

Total Additions 6,076,774$ 3,082,945$ 332,996$ 93,395$ 186,307$ 790,703$ 100,962$ 6,628$ 10,670,710$

Deductions

3,024,938$ 1,577,009$ 160,501$ 49,472$ 79,176$ 412,857$ 28,289$ 2,497$ 5,334,739$

Transfers and Rounding Adjustments 4,901 - - 2 - 2 - - 4,905

Total Deductions 3,029,839$ 1,577,009$ 160,501$ 49,474$ 79,176$ 412,859$ 28,289$ 2,497$ 5,339,644$

Net Increase in Net Position 3,046,935$ 1,505,936$ 172,495$ 43,921$ 107,131$ 377,844$ 72,673$ 4,131$ 5,331,066$

Net Position Restricted for Pensions

Beginning of Year 41,120,490$ 17,292,867$ 1,949,454$ 608,868$ 1,012,430$ 5,363,432$ 518,919$ 43,248$ 67,909,708$

End of Year 44,167,425$ 18,798,803$ 2,121,949$ 652,789$ 1,119,561$ 5,741,276$ 591,592$ 47,379$ 73,240,774$

Benefit payments, including refunds of employee contributions and Administrative Expenses

SECTION C

REQUIRED SUPPLEMENTARY INFORMATION

This information is presented in draft form for review by the System’s auditor. Please let us know if

Maryland State Retirement and Pension System 12

Schedule of Changes in Net Pension Liability and Related Ratios Current Period Fiscal Year Ended June 30, 2025

($ in Thousands)

A. Total pension liability TCS ECS (State) State Police Judges LEOPS (State) ECS (Muni) LEOPS (Muni) CORS (Muni) Total MSRPS

1. Service Cost 1,153,053$ 567,920$ 58,825$ 25,130$ 42,878$ 164,713$ 29,281$ 1,697$ 2,043,497$

2. Interest on the total pension liability 3,664,242 1,766,850 202,874 49,919 103,616 455,080 51,961 3,909 6,298,451

3. Changes of benefit terms - - - - - - - - -

4. Difference between expected and actual experience of the total pension liability 954,645 463,805 62,061 18,631 21,839 118,716 24,966 2,241 1,666,904

5. Changes of assumptions - - - - - - - - -

6. Benefit payments, including refunds of employee contributions (2,991,732) (1,558,174) (160,108) (49,376) (78,551) (407,926) (28,067) (2,467) (5,276,401)

7. Net change in total pension liability 2,780,208$ 1,240,401$ 163,652$ 44,304$ 89,782$ 330,583$ 78,141$ 5,380$ 4,732,451$

8. Total pension liability – beginning 54,790,125 26,470,071 3,033,248 746,026 1,541,315 6,811,959 763,535 57,865 94,214,144

9. Total pension liability – ending 57,570,333$ 27,710,472$ 3,196,900$ 790,330$ 1,631,097$ 7,142,542$ 841,676$ 63,245$ 98,946,595$

B. Plan fiduciary net position

1. Contributions – employer 1,429,515$ 1,061,020$ 130,757$ 29,998$ 73,275$ 178,341$ 42,714$ 1,834$ 2,947,454$

2. Contributions – employee 671,715 329,180 11,914 4,389 12,966 92,691 6,610 553 1,130,018

3. Net investment income 3,975,544 1,688,995 190,101 59,008 99,135 519,671 51,638 4,241 6,588,333

4. Benefit payments, including refunds and administrative expenses (3,024,938) (1,577,009) (160,501) (49,472) (79,176) (412,857) (28,289) (2,497) (5,334,739)

5. Net transfers/rounding adjustments (4,901) 3,750 224 (2) 931 (2) - - -

6. Net change in plan fiduciary net position 3,046,935$ 1,505,936$ 172,495$ 43,921$ 107,131$ 377,844$ 72,673$ 4,131$ 5,331,066$

7. Plan fiduciary net position – beginning 41,120,490 17,292,867 1,949,454 608,868 1,012,430 5,363,432 518,919 43,248 67,909,708

8. Plan fiduciary net position – ending 44,167,425$ 18,798,803$ 2,121,949$ 652,789$ 1,119,561$ 5,741,276$ 591,592$ 47,379$ 73,240,774$

C. Net pension liability 13,402,908$ 8,911,669$ 1,074,951$ 137,541$ 511,536$ 1,401,266$ 250,084$ 15,866$ 25,705,821$

D. Plan fiduciary net position as a percentage of the total pension liability 76.72% 67.84% 66.38% 82.60% 68.64% 80.38% 70.29% 74.91% 74.02%

E. Covered payroll 9,537,248$ 4,942,736$ 151,105$ 63,061$ 165,299$ 1,675,618$ 114,243$ 11,394$ 16,660,704$

F. Net pension liability as a percentage of Covered payroll 140.53% 180.30% 711.39% 218.11% 309.46% 83.63% 218.91% 139.25% 154.29%

Maryland State Retirement and Pension System 13

Schedules of Required Supplementary Information Schedule of Changes in Net Pension Liability and Related Ratios Multiyear

($ in Thousands)

Total MSRPS

Fiscal year ending June 30, 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016

Total Pension Liability

Service Cost 2,043,497$ 1,877,205$ 1,739,209$ 1,604,970$ 1,431,276$ 1,422,322$ 1,358,759$ 1,321,018$ 1,308,260$ 1,284,885$

Interest on the Total Pension Liability 6,298,451 5,873,560 5,632,880 5,520,922 5,606,970 5,417,995 5,327,872 5,204,067 5,120,034 4,943,021

Benefit Changes - 68 (5,109) - - (94) - 2,400 - -

1,666,904 2,559,018 991,681 (927,288) (769,370) (44,609) (251,587) (671,134) (1,266,972) (311,650)

Assumption Changes - 1,004,742 - - 3,468,353 - (681,226) 154,328 130,175 -

Benefit Payments (5,160,041) (4,916,424) (4,653,163) (4,394,351) (4,253,048) (4,108,493) (3,926,222) (3,744,132) (3,577,123) (3,469,493)

Refunds (116,360) (107,309) (101,737) (91,535) (64,773) (68,752) (67,400) (68,600) (63,441) (58,361)

Net Change in Total Pension Liability 4,732,451 6,290,860 3,603,761 1,712,718 5,419,408 2,618,368 1,760,195 2,197,946 1,650,933 2,388,402

Total Pension Liability - Beginning 94,214,144 87,923,284 84,319,523 82,606,805 77,187,397 74,569,029 72,808,834 70,610,888 68,959,955 66,571,553

Total Pension Liability - Ending (a) 98,946,595$ 94,214,144$ 87,923,284$ 84,319,523$ 82,606,805$ 77,187,397$ 74,569,029$ 72,808,834$ 70,610,887$ 68,959,955$

Plan Fiduciary Net Position

Employer Contributions 2,947,454$ 2,618,316$ 2,438,917$ 2,282,303$ 2,203,524$ 2,144,269$ 2,054,092$ 1,995,017$ 2,033,312$ 1,870,655$

Employee Contributions 1,130,018 1,056,173 963,702 894,267 865,738 850,298 807,290 791,583 782,689 764,414

Pension Plan Net Investment Income 6,588,333 4,416,775 1,980,277 (1,942,135) 14,315,762 1,866,641 3,288,210 3,899,393 4,473,443 497,531

Benefit Payments (5,160,041) (4,916,424) (4,653,163) (4,394,351) (4,253,048) (4,108,493) (3,926,222) (3,744,132) (3,577,123) (3,469,493)

Refunds (116,360) (107,309) (101,737) (91,535) (64,773) (68,752) (67,400) (68,600) (63,441) (58,361)

Pension Plan Administrative Expense (58,338) (50,796) (46,014) (42,061) (48,741) (41,344) (39,784) (33,211) (27,622) (28,659)

Net Transfers/Rounding Adjustments - - - 3 1 (1) - - - -

Net Change in Plan Fiduciary Net Position 5,331,066 3,016,735 581,982 (3,293,509) 13,018,463 642,618 2,116,186 2,840,050 3,621,258 (423,914)

Plan Fiduciary Net Position - Beginning 67,909,708 64,892,973 64,310,991 67,604,500 54,586,037 53,943,419 51,827,233 48,987,183 45,365,925 45,789,840

Plan Fiduciary Net Position - Ending (b) 73,240,774$ 67,909,708$ 64,892,973$ 64,310,991$ 67,604,500$ 54,586,037$ 53,943,419$ 51,827,233$ 48,987,183$ 45,365,926$

Net Pension Liability - Ending (a) - (b) 25,705,821$ 26,304,436$ 23,030,311$ 20,008,532$ 15,002,305$ 22,601,360$ 20,625,610$ 20,981,601$ 21,623,704$ 23,594,029$

Plan Fiduciary Net Position as a Percentage of Total Pension Liability 74.02 % 72.08 % 73.81 % 76.27 % 81.84 % 70.72 % 72.34 % 71.18 % 69.38 % 65.79 %

Covered Payroll 16,660,704$ 15,650,353$ 14,384,589$ 13,201,815$ 12,749,247$ 12,501,422$ 11,905,463$ 11,566,220$ 11,418,973$ 11,155,924$

Net Pension Liability as a Percentage of Covered Payroll 154.29 % 168.08 % 160.10 % 151.56 % 117.67 % 180.79 % 173.24 % 181.40 % 189.37 % 211.49 %

Difference between Expected and Actual Experience

Maryland State Retirement and Pension System 14

Schedules of Required Supplementary Information Schedule of the Net Pension Liability Multiyear

($ in Thousands)

Total MSRPS

Total

FY Ending Pension Plan Net Net Pension Covered

June 30, Liability Position Liability Payroll

2016 68,959,955$ 45,365,926$ 23,594,029$ 65.79 % 11,155,924$ * 211.49 %

2017 70,610,887 48,987,183 21,623,704 69.38 11,418,973 * 189.37

2018 72,808,834 51,827,233 20,981,601 71.18 11,566,220 * 181.40

2019 74,569,029 53,943,419 20,625,610 72.34 11,905,463 * 173.24

2020 77,187,397 54,586,037 22,601,360 70.72 12,501,422 * 180.79

2021 82,606,805 67,604,500 15,002,305 81.84 12,749,247 * 117.67

2022 84,319,523 64,310,991 20,008,532 76.27 13,201,815 * 151.56

2023 87,923,284 64,892,973 23,030,311 73.81 14,384,589 * 160.10

2024 94,214,144 67,909,708 26,304,436 72.08 15,650,353 * 168.08

2025 98,946,595 73,240,774 25,705,821 74.02 16,660,704 * 154.29

Plan Net Position as a % of Total

Pension Liability Covered Payroll as a % of

Net Pension Liability

*Payroll from the corresponding June 30 valuation.

Maryland State Retirement and Pension System 15

Schedule of Contributions Multiyear

Total MSRPS

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 1,948,082$ 1,870,655$ 77,427$ 11,155,924$ * 16.77 %

2017 2,033,312 2,033,312 - 11,418,973 * 17.81

2018 1,995,017 1,995,017 - 11,566,220 * 17.25

2019 2,054,092 2,054,092 - 11,905,463 * 17.25

2020 2,144,269 2,144,269 - 12,501,422 * 17.15

2021 2,203,524 2,203,524 - 12,749,247 * 17.28

2022 2,282,303 2,282,303 - 13,201,815 * 17.29

2023 2,438,917 2,438,917 - 14,384,589 * 16.96

2024 2,618,316 2,618,316 - 15,650,353 * 16.73

2025 2,947,454 2,947,454 - 16,660,704 * 17.69

Covered Payroll

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 16

Teachers’ Combined System

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 1,112,989$ 1,084,049$ 28,940$ 6,611,038$ * 16.40 %

2017 1,137,472 1,137,472 - 6,780,838 * 16.77

2018 1,122,986 1,122,986 - 6,941,097 * 16.18

2019 1,143,586 1,143,586 - 7,153,063 * 15.99

2020 1,170,248 1,170,248 - 7,492,465 * 15.62

2021 1,153,208 1,153,208 - 7,688,846 * 15.00

2022 1,202,102 1,202,102 - 7,957,775 * 15.11

2023 1,228,568 1,228,568 - 8,468,612 * 14.51

2024 1,272,405 1,272,405 - 9,102,349 * 13.98

2025 1,429,515 1,429,515 - 9,537,248 * 14.99

Actual Contribution

Covered Payroll

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 17

Employees’ Combined System (State)

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 596,485$ 547,997$ 48,488$ 3,171,359$ * 17.28 %

2017 639,796 639,796 - 3,218,598 * 19.88

2018 611,151 611,151 - 3,165,588 * 19.31

2019 632,478 632,478 - 3,232,027 * 19.57

2020 675,858 675,858 - 3,399,919 * 19.88

2021 727,495 727,495 - 3,425,932 * 21.23

2022 753,727 753,727 - 3,537,250 * 21.31

2023 847,973 847,973 - 4,039,278 * 20.99

2024 944,564 944,564 - 4,493,812 * 21.02

2025 1,061,020 1,061,020 - 4,942,736 * 21.47

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 18

State Police

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 72,320$ 72,320$ $ - 93,491$ * 77.36 %

2017 83,000 83,000 - 100,384 * 82.68

2018 80,241 80,241 - 100,325 * 79.98

2019 86,172 86,172 - 106,978 * 80.55

2020 91,390 91,390 - 116,274 * 78.60

2021 93,651 93,651 - 119,048 * 78.67

2022 95,453 95,453 - 124,367 * 76.75

2023 106,966 106,966 - 139,458 * 76.70

2024 115,333 115,333 - 145,026 * 79.53

2025 130,757 130,757 - 151,105 * 86.53

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 19

Judges

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 18,384$ 18,384$ -$ 44,711$ * 41.12 %

2017 21,861 21,861 - 46,876 * 46.64

2018 22,465 22,465 - 47,498 * 47.30

2019 21,736 21,736 - 48,935 * 44.42

2020 22,708 22,708 - 51,882 * 43.77

2021 21,277 21,277 - 52,073 * 40.86

2022 22,816 22,816 - 53,934 * 42.30

2023 23,675 23,675 - 58,696 * 40.34

2024 26,085 26,085 - 61,181 * 42.64

2025 29,998 29,998 - 63,061 * 47.57

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 20

LEOPS (State)

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 37,544$ 37,544$ -$ 102,097$ * 36.77 %

2017 42,074 42,074 - 106,826 * 39.39

2018 42,298 42,298 - 107,730 * 39.26

2019 44,527 44,527 - 113,982 * 39.07

2020 48,263 48,263 - 122,267 * 39.47

2021 52,505 52,505 - 125,116 * 41.96

2022 54,673 54,673 - 127,950 * 42.73

2023 63,192 63,192 - 146,948 * 43.00

2024 68,874 68,874 - 158,000 * 43.59

2025 73,275 73,275 - 165,299 * 44.33

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 21

Employees’ Combined System (Municipal)

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 92,436$ 92,436$ -$ 1,073,975$ * 8.61 %

2017 90,232 90,232 - 1,100,455 * 8.20

2018 95,542 95,542 - 1,135,660 * 8.41

2019 104,264 104,264 - 1,177,913 * 8.85

2020 112,422 112,422 - 1,238,278 * 9.08

2021 127,811 127,811 - 1,255,934 * 10.18

2022 125,925 125,925 - 1,307,508 * 9.63

2023 136,034 136,034 - 1,426,495 * 9.54

2024 153,921 153,921 - 1,570,029 * 9.80

2025 178,341 178,341 - 1,675,618 * 10.64

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 22

LEOPS (Municipal)

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 17,415$ 17,415$ -$ 54,299$ * 32.07

2017 18,399 18,399 - 59,735 * 30.80

2018 19,833 19,833 - 62,826 * 31.57

2019 20,787 20,787 - 66,981 * 31.03

2020 22,807 22,807 - 72,400 * 31.50

2021 26,663 26,663 - 74,344 * 35.86

2022 26,587 26,587 - 85,053 * 31.26

2023 31,390 31,390 - 94,989 * 33.05

2024 35,980 35,980 - 109,415 * 32.88

2025 42,714 42,714 - 114,243 * 37.39

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 23

Correctional Officers’ Retirement System (Municipal)

Actuarially Contribution

FY Ending Determined Actual Deficiency Covered

June 30, Contribution Contribution (Excess) Payroll

2016 510$ 510$ -$ 4,954$ * 10.29 %

2017 478 478 - 5,262 * 9.08

2018 501 501 - 5,498 * 9.11

2019 542 542 - 5,583 * 9.71

2020 573 573 - 7,937 * 7.22

2021 913 913 - 7,953 * 11.48

2022 1,020 1,020 - 7,979 * 12.78

2023 1,119 1,119 - 10,113 * 11.06

2024 1,154 1,154 - 10,541 * 10.95

2025 1,834 1,834 - 11,394 * 16.10

Actual Contribution

For the State Systems before 2017, the Actuarially Determined Contribution is equal to the greater of: 1) The actuarially determined contribution under the System’s funding policy before application of the corridor funding method, plus reinvested savings contributions, and 2) Employer normal cost plus 30-year amortization of the unfunded liability (Annual Required Contribution under GASB Statement Nos. 25 and 27), plus reinvested savings. For the Municipal Systems and State Systems beginning with 2017, the actuarially determined contribution is under the System’s funding policy.

Maryland State Retirement and Pension System 24

Notes to Schedule of Contributions

Valuation Date: June 30, 2023

Notes Actuarially determined contribution rates are calculated as of June 30, which is 12 months prior to the beginning of the fiscal year in which contributions are reported.

Methods and Assumptions Used to Determine Contribution Rates for the Fiscal Year Ending June 30, 2025:

Actuarial Cost Method Entry Age Normal

Amortization Method Level Percentage of Payroll, Closed

Remaining Amortization Period 15 years for the State Systems, 19 years for ECS Muni, 16 years for LEOPS Muni, and 23 years for CORS Muni.

Asset Valuation Method 5-Year smoothed market; 20% collar

Inflation 2.25% general, 2.75% wage.

Salary Increases 2.75% to 11.25% including inflation.

Investment Rate of Return 6.80%

Retirement Age Experience-based table of rates that are specific to the type of eligibil ity condition. Last updated for the 2019 valuation pursuant to an experience study of the period 2014 -

2018.

Mortality Various versions of the Pub-2010 Mortality Tables with projected generational mortality improvements based on the MP-2018 fully generational mortality improvement scale.

Other Information:

Notes There were no assumption or benefits changes since the previous measurement date.

Maryland State Retirement and Pension System 25

Schedule of Investment Returns Multiyear

FY Ending

June 30, 2016 1.16 %

2017 10.02 %

2018 8.08 %

2019 6.44 %

2020 3.56 %

2021 26.76 %

2022 (2.90)%

2023 3.11 %

2024 6.84 %

2025 9.83 %

Annual

Return1

1 Annual money-weighted rate of return, net of investment expenses. This information was provided by MSRA and/or

MSRPS’ investment consultant.

Note: This disclosure is intended to capture performance net of pension plan investment expense, which has been adjusted for changing amounts actually invested; taking into consideration benefit payments and contributions. Currently, the Agency is experiencing net outflows resulting in contributions being used to pay benefits rather than flowing through invested funds; therefore, there is minimal variation between this schedule and the time-weighted rates of return presented in the Investment Section of this report.

SECTION D

NOTES TO FINANCIAL STATEMENTS

This information is presented in draft form for review by the System’s auditor. Please let us know if

Maryland State Retirement and Pension System 26

Long-Term Expected Return on Plan Assets

The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. For each major asset class that is included in the System’s target asset allocation as of June 30, 2025, these best estimates are summarized in the following table:

Asset Allocation*

Asset Class

Public Equity 34.0% 5.9%

Private Equity 16.0% 8.5%

Rate Sensitive 20.0% 3.0%

Credit 9.0% 5.4%

Real Assets 15.0% 5.9%

Absolute Return 6.0% 3.8%

Total 100.0%

Target Allocation

Long-Term Expected

Geometric

Real Rate of Return

* This information was provided by MSRA.

Maryland State Retirement and Pension System 27

Single Discount Rate

A Single Discount Rate of 6.80% was used to measure the Total Pension Liability. This Single Discount Rate was based on the expected rate of return on pension plan investments of 6.80%. The projection of cash flows used to determine this Single Discount Rate assumed that plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on these assumptions, the pension plan’s Fiduciary Net Position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the Total Pension Liability.

Regarding the sensitivity of the Net Pension…