Frank Sinatra was onto something when he sang, “riding high in April, shot down in May.”

Greenwich’s public sector pension fund lost 4.6 percent in value during the month of May, dropping from $312 million in value to $296 million.

“May was a bad month,” said Peter Mynarski Jr., the town comptroller. “You have to go back to 2008, I guess, to find a comparable bad month.”

Town officials attributed the decline to the economic unrest in the European Union, where a continental debt crisis is threatening the 27-country confederation.

“International did the worst, by far,” Mynarski said. “That was the biggest drag. Also, it carried over into the domestic equities.”

Just how gun shy is the town over certain investments?

A proposal by the town’s Retirement Board to invest $4 million from the pension fund in an investment vehicle that specialises in non-performing European loans and is based in the Caribbean tax shelter of the Cayman Islands was yanked from the Board of Estimate and Taxation‘s agenda Monday night.

BET leaders confirmed that the investment with Apollo European Principal Finance Fund II L.P. is off the table.

“The world has changed because of what’s going on in Europe, particularly in Greece, Spain and Italy,” Joseph Pellegrino, chairman of the BET Budget Committee, told Greenwich Time.

Elected officials also signaled their reluctance to invest public sector pension funds in an off-shore entity in the Cayman Islands.

“I think that’s one of the concerns that came up,” said Michael Mason, chairman of the full BET.

The pension fund pays out about $22.5 million yearly to 1,149 municipal pensioners. Teachers are not covered by the fund.

The fund is down 2.8 percent over the last 12 months.

Taxpayers have a vested interest in how well the town’s pension system performs, as they have been called upon to ramp up their contributions in recent years to the fund to make it solvent.

During the last five years, the town’s contribution went from $6.6 million in 2008-09 to $16.4 million for the fiscal year starting July 1.

Weakened by plunging stock values, the town’s pension fund lost about 25.5 percent in value — nearly $70 million — during a one-year period ending June 30, 2009.

Four years removed from its high-water mark of $361 million in October 2007, the fund is seeing its liabilities catch up with assets.

Liabilities are defined as benefits earned by current retirees who are part of the pension system and their beneficiaries, as well as projected future benefits of current town employees.

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