Ontario Teachers’ Pension Plan, Canada’s third-biggest retirement-fund manager, posted a 13 percent return on investments in 2012, led by real estate, private equity and stocks.
Net investment income rose to C$14.7 billion ($14.5 billion) from C$11.7 billion in 2011, the Toronto-based pension- fund manager said today in a statement. The fund managed C$129.5 billion in assets as of Dec. 31, up from C$117.1 billion a year earlier.
“The investment team successfully navigated significant risks and turmoil in the global economy again in 2012 to earn an excellent rate of return,” Chief Executive Officer Jim Leech, 65, said in the statement. “This was an oustanding achievement during a challenging year.”
Ontario Teachers’ beat the 9.4 percent median return of Canadian pension funds in 2012, based on a Jan. 29 report by Royal Bank of Canada’s RBC Investor Services unit. In comparison, Caisse de Depot et Placement du Quebec, Canada’s largest pension-fund manager, returned 9.6 percent, Ontario Municipal Employees Retirement System gained 10 percent, and Healthcare of Ontario Pension Plan rose 17 percent.
Teachers’ is responsible for investing and managing pensions for about 303,000 active and retired teachers in Canada’s most populous province.
Teachers’ said public and private equity investments returned 14 percent in 2012, while fixed income holdings returned 5.1 percent. Commodities lost 1.9 percent last year.
Investments held by Teachers’ private-equity unit returned 19 percent in 2012, the pension fund said. Teachers’ Private Capital managed C$12 billion of assets at the end of the year, compared with C$12.2 billion a year earlier.
Real assets such as real estate, infrastructure and timberland returned about 15 percent. The fund’s real-estate portfolio, which had C$16.9 billion of assets, returned 19 percent for the year.
Teachers’ estimated funding shortfall was C$5.1 billion, down from C$9.6 billion a year earlier, after changes to inflation-protection guarantees for plan members were announced in February.
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