The Canada Pension Plan Investment Board fund earned a 3.4-per-cent return on its investments in its latest quarter.
CPPIB said its assets grew by $7.6-billion in the fiscal second quarter ended Sept. 30, with assets increasing to $234.4-billion from $226.8-billion in the previous quarter.
Growth consisted of $7.5-billion in net investment income and $0.1-billion from new contributions.
The modest return is in stark contrast to much higher returns posted last year, as growth in global markets slows.
“During the quarter, our investment portfolio reflected mixed performance from the global public equity markets, balanced by solid returns from our fixed income assets and positive contributions from our private investments,” CPPIB president and chief executive officer Mark Wiseman said.
“We continue to realize the benefits of a globally diversified, resilient portfolio that is designed to deliver superior returns over the long term.”
Canada’s largest pension fund manager said on Thursday that the Chief Actuary of Canada has projected that the fund will attain a 4-per-cent rate of return after inflation on a long-term basis.
CPPIB has a five-year rate of return of 8.2 percent and a 10-year return rate of 5.6 percent, above the actuary’s assumptions.
For the period ended Sept. 30, the fund’s asset mix consisted of 33 percent in public equities, 18.3 percent in private equity, 32.5 percent in fixed income, 10.8 percent in real estate and 5.4 percent in infrastructure.
As of Dec. 31, 2012, the plan remains sustainable at the current contribution rate of 9.9 percent over a 75-year period, according to the most recent actuary’s report, released almost a year ago.
TORONTO -- The Canada Pension Plan Investment Board said it earned a 3.4 per cent return in its latest quarter.
The board, which manages portfolios on behalf of the Canada Pension Plan, had net assets of $234.4 billion for the period ended Sept. 30.
That was up from $226.8 billion at the end of the previous quarter.
It says the majority of the increase, or $7.5 billion, was due to net investment income.
The remaining $100 million was net CPP contributions.
CPPIB invests money not currently needed by the Canada Pension Plan to pay benefits.
The board says it's building an investment portfolio with a "exceptionally long investment horizon" and that is a more indicative of its performance than the returns of any given quarter or year.
"We continue to realize the benefits of a globally diversified, resilient portfolio that is designed to deliver superior returns over the long term," said president and chief executive Mark Wiseman in a statement.
During the quarter, CPPIB closed a deal to acquire a 39 per cent stake in Interparking, one of Europe's largest parking lot management companies, for about $546 million.
Based in Brussels and with operations across nine countries in Europe, Interparking owns 657 car parks in 350 cities.
Canada Pension Plan Assets Grow by 22% to C$234 Billion
Canada Pension Plan Investment Board, the country’s largest pension fund manager, said it returned 3.4 percent from its investments in the third quarter on the back of a strong public equity performance.
“Our investment portfolio reflected mixed performance from the global public equity markets, balanced by solid returns from our fixed-income assets and positive contributions from our private investments,” said Canada Pension Chief Executive Officer Mark Wiseman in the statement.
The fund manager, which handles the retirement savings of 18 million Canadians, reported net assets of C$234.4 billion ($207 billion), up 22 percent from a year ago
Sources BNN, CP, Bloomberg
Sources BNN, CP, Bloomberg
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