Canada Pension Posts Flat Returns in Volatile Global Markets

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Canada Pension Plan Investment Board said its returns on investments were flat during the three months through June in what was one of the busiest quarters on record for deals involving the country’s largest pension plan.

Assets under management grew 18 percent to C$269 billion ($206 billion) in the quarter from a year earlier as the fund added businesses from credit to software to its portfolio, Canada Pension said in a statement.

The fund “held steady” despite broad declines in major global equity and fixed-income markets, Mark Wiseman, Canada Pension chief executive officer, said. Gross investment return was 0.01 percent.

“Amid these difficult market conditions, our private investment programs generated meaningful income, exemplifying the benefits of building a resilient, broadly diversified portfolio,” Wiseman said in a statement.

Canada Pension wasn’t the only fund facing a challenging second quarter. Canadian pension plan assets had the first quarterly decline since 2012, according to a survey earlier this month by the Royal Bank of Canada’s Investor and Treasury Services. Holdings fell 1.6 percent, dragged down by the Greek debt crises, weakness in energy and resources, and rising bond yields, according to the survey of pension funds that managed C$650 billion worth of assets in the country.

The fund made 25 investments during the quarter, including its largest acquisition to date with the purchase of GE’s leveraged loan business for $12 billion in June. The pension fund was also part of a consortium that bought California-based software company Informatica Corp. in April in a leveraged buyout valued at $4.7 billion.

Canada Pension had 49.5 percent of its assets invested in public and private equities at the end of the period, 33.5 percent in fixed income and 17 percent in real assets.

“We continue to assess and seize opportunities that fit our disciplined approach,” Wiseman said.

Canada Pension, which manages the retirement savings of 18 million Canadians, participated in nine transactions valued at $22.4 billion in the quarter, according data compiled by Bloomberg.