The Hawai'i Employees' Retirement System portfolio rose by $308 million to $10.52 billion during the three months ended March 31, capping a year in which its investments came roaring back off market lows.

ERS trustees yesterday learned the value of investments rose by 3.3 percent in the January-to-March period, or more than what it would be expected to produce given its policy benchmark.

Rod June, ERS chief investment officer, said the gain was helped by fixed income investments outperforming expectations and by an increase in U.S. stocks. A decline in international equities held by the fund offset some of the increase, he said.

The gain was a welcome one for the pension plan, which is used to pay retirement benefits for former state and county workers. The value of the investments is coming back from a stinging downturn in prior years as the economy and financial markets sank.

During the past year, the fund has charted gains each quarter, coming back from an astonishing plunge in investment values that began in 2008 and continued into 2009 as Wall Street tried to recover from a financial meltdown.

June said during the one-year period the ERS portfolio — which is managed by a mix of professional money managers — surged 29.6 percent.

That equated to a $2.39 billion increase as the portfolio recovered from the low of $8.12 billion at the end of March 2009.

"We've all seen the market really rise," said June, explaining the gains were led by a surge in U.S. and international equities.

The pension plan uses a combination of funding from the state and counties along with investment gains to pay for current retirees' benefits, as well as establish funding for future benefits. The ERS seeks an 8 percent annual return on its investments.