Quebec pension fund giant Caisse de dépôt et placement du Québec reported today that the weighed average return on depositors’ funds was 12.2% in 2004.

The depositors’ individual returns, which vary according to the investment policy established for each of them, range from 5.0% to 14.6%.

Since December 31, 2002, the Caisse says depositors’ net assets have increased $24.7 billion, or 31.8%, rising from $77.7 billion to $102.4 billion. The growth was due mainly to investment operations, which generated $22.3 billion, while net deposits made by the depositors during the same period totalled $2.4 billion.

“These first-quartile results represent an improvement over the Caisse’s performance in 2003. The 12.2% weighted average return on depositors’ funds earned in 2004 is 90 basis points above the first-quartile return threshold for Canadian fund managers and almost 200 basis points above the median performance, according to the benchmarking studies available,” said

“These results reflect our efforts to succeed over the long term on national and international markets that are more competitive and complex than ever. The results are also good news for our depositors and all members of the pension and insurance plans whose funds are managed by the Caisse. All depositors benefited from positive value added in 2004 and a performance that exceeded the indexes specified in their investment policies.

“The record return earned on real estate and a solid private equity performance contributed significantly to these results, which also reflect the strength of the equity markets around the world, the appreciation of our fixed income portfolios and the contribution of our absolute return operations,” said Henri-Paul Rousseau, chairman and CEO.

“The average return of 12.2% is 100 basis points above the weighted average of the long-term benchmark indexes specified in the depositors’ investment policies and 247 basis points above the short-term thresholds,” he added.

“In 2004, the equity sector returned 12.6% with slightly negative value added of seven basis points versus negative value added of 71 basis points in 2003. Although this is a definite change for the better, improving our performance, especially on the international equity markets, is still a major challenge that will require investments in human resources, research and risk management.”

Rousseau noted that 2005 marks both the 40th anniversary of the founding of the Caisse and the coming into force of the act that clarifies the Caisse’s mission and introduces new governance rules. “This new legal framework will enable the Caisse to continue to implement a performance-oriented culture that benefits its depositors,” he said.