TORONTO, March 25, 2014 /CNW/ - Ontario Pension Board (OPB), the administrator of Ontario's Public Service Pension Plan (PSPP), ended 2013 with an annual investment return of 12.5 per cent, exceeding its benchmark return by 3.1 per cent. Investment income during the year amounted to $2.24 billion, which included $550 million in value-added returns above the benchmark.
"Our 2013 annual investment return caps off a very successful five years for our Investments team, with a compound annual rate of return of 9.1 per cent over that period," said Mark Fuller, President and CEO of OPB. "Our compound annual rate of return since inception of 8.6 per cent exceeds the annual rate of return of 5.95 per cent required to fund the Plan over the long term."
"The funded status of the PSPP is strong and has benefited from our investment success," continued Mr. Fuller. "We are 96 per cent funded at year-end 2013, even though we made adjustments to acknowledge continued improvement in life spans." The PSPP passed the $20 billion mark in net assets for the first time, closing 2013 at approximately $21 billion.
Other factors that contributed to the improvement of the funded status of the PSPP include gains from continuing salary restraint in the public service in Ontario, and low inflation.
"It was also a milestone year for OPB on the investment transaction front," added Mr. Fuller. "We participated in our largest investment transaction to date as part of the consortium that acquired Primaris Real Estate Investment Trust, and in the process, continued to build OPB's reputation as a respected and desirable investment partner."
Notable investment transactions for OPB in 2013 included:
- Grew its high-performing real estate portfolio with an addition of 14 retail properties across Canada as part of the deal to acquire Primaris Real Estate Investment Trust, and investments in high-quality office properties in Manhattan and Paris, France;
- Several additions to the infrastructure portfolio as part of the strategy to increase allocation to private market assets; and
- Invested U.S. $150 million in China A-shares mandate as a holder of a Qualified Foreign Institutional Investor (QFII) licence in China.
OPB's full 2013 annual report, including Management's Discussion & Analysis and Financial Statements will be posted on www.opb.ca after it is tabled in the Legislature of Ontario.
Ontario Pension Board (OPB) administers Ontario's Public Service Pension Plan (PSPP), a defined benefit pension plan serving approximately 42,000 active members and their employers, as well as more than 40,000 retired and former members. With approximately $21 billion in net assets, the PSPP is one of Canada's largest pension plans. It's also one of Canada's oldest pension plans, successfully delivering the pension promise since the early 1920s. To learn more about OPB, visit www.opb.ca
SOURCE: Ontario Pension Board
For further information: Stephanie Woodward, Director, Stakeholder Relations, Tel: 416-601-4095, [email protected]