Canada’s 10 largest public pension funds have tripled their total assets under management (AUM) from 2003 to 2014, with 80% of this increase in value being driven by investment returns, according to a new report from Boston-based Boston Consulting Group (BCG).
Specifically, the report, which was produced on behalf of those pension funds and released on Thursday, analyzed the 10 largest Canadian pension funds based on their size of net pension AUM, which was more than $1 trillion in total AUM in 2014. These include: the Canada Pension Plan Investment Board ($265 billion), the Caisse de dépôt et placement du Québec ($192 billion), the Ontario Teachers’ Pension Plan Board ($154 billion), PSP Investments ($112 billion), British Columbia Investment Management Corp. ($104 billion), the Ontario Municipal Employees Retirement System ($73 billion), the Healthcare of Ontario Pension Plan ($61 billion), the Alberta Investment Management Corp. ($50 billion), the Ontario Pension Board ($22 billion) and the OPSEU Pension Trust ($18 billion).
“The ‘Top 10′ have shown impressive growth in investment capabilities and scale to manage the realities of a post-financial crisis world,” says Craig Hapelt, a partner with BCG in Toronto, in a statement. “Not only do the funds represent an important aspect of Canada’s retirement income landscape, but their investments also have a broader positive impact on Canada’s prosperity.”
The report also found that these 10 pension funds have invested approximately $600 billion across various asset classes with a significant portion invested in alternative asset classes, such as infrastructure, private equity and real estate. These 10 public pension funds have allocated 32% of their investments to these alternative asset classes compared with less than 11% allocation by most other Canadian pension funds.
The report also provided some examples of where these funds invest. These include Toronto-based TMX Group Ltd., Yorkdale Shopping Centre, also in Toronto, and TimberWest Forest Corp. in Vancouver. Their international holdings include Port of Brisbane Pty Ltd., a fast-growing container port in Australia and the Camelot Group, the U.K.’s national lottery operator.