Quebec pension fund manager Caisse posts strong returns in 2015

Wed Feb 24, 2016 11:00am EST
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MONTREAL Feb 24 (Reuters) - Caisse de depot et Placement du Quebec, Canada's second-largest pension fund manager, reported weighted average returns of 9.1 percent in 2015 on Wednesday, benefiting from diversifying out of equities and bonds into higher-yielding assets such as infrastructure and real estate.

The Caisse, which manages pension plans in the mostly French-speaking province, said its net assets had grown to C$248 billion at the end of 2015, compared with C$225.9 billion at the end of 2014.

The performance was weaker than the average return of 12 percent achieved in 2014, reflecting volatile equity markets and global economic uncertainty.

Since Chief Executive Michael Sabia was appointed in 2009, the Caisse has sought higher returns by investing more funds in alternative assets such as infrastructure and real estate, shifting funds out of equities and low-yielding government bonds. However, equities still make up the biggest proportion of its overall investments.

"In 2015, our strategy was put to the test. Uncertainty in the face of monetary policy, disorderly currency movements and collapsing oil prices all fuelled market volatility, particularly in the second half," Sabia said.

"In this context, the quality of the assets in our portfolio allowed us to deliver solid results, confirming the soundness of our strategy. While not immunizing our portfolio against market movements, our strategy makes it more resilient in turbulent times," he said. (Reporting by Matt Scuffham; Editing by Meredith Mazzilli)