Quebec pension fund says must 'raise game' to maintain returns

Fri Aug 14, 2015 11:46am EDT
 
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By Allison Lampert

MONTREAL Aug 14 (Reuters) - Caisse de depot et placement du Quebec, Canada's second-largest pension fund manager, said it will have to "raise its game" if it is to continue to deliver yields like the weighted average return of 5.9 percent it reported Friday for the first six months of 2015.

The Caisse, which manages public pension plans in the predominantly French-speaking province of Quebec, has said it is counting on yields from its infrastructure and real estate divisions to carry the load given expected weaker returns from equity markets.

Its four-year average annual return has been 10.2 percent.

"Like all investors, the Caisse has certainly benefited from bull markets that have been fueled by stimulative monetary policies," Chief Executive Michael Sabia said in a news release.

"Continuing to do well will be even more challenging in the months and years to come," he added. "Against a backdrop of high asset valuations and growing economic and geopolitical risks, we will need to be even more rigorous in choosing our investments."

The Caisse reported net assets of C$240 billion ($184.12 billion) as of June 30, compared with C$225.9 billion at the end of 2014.

($1=$1.3035 Canadian) (Reporting By Allison Lampert; Editing by Peter Galloway)