TORONTO, ONTARIO — (Marketwire) — 11/10/11 — The CPP Fund ended the second quarter of fiscal 2012 on September 30, 2011 at $152.3 billion compared to $153.2 billion at the end of the first quarter on June 30, 2011.
The $0.9 billion decrease in net assets resulted from an investment loss of $1.2 billion, or a negative 0.8% rate of return, partially offset by inflows of CPP contributions of $0.4 billion during the quarter.
For the six month fiscal year-to-date period, the CPP Fund increased by $4.1 billion from $148.2 billion at March 31, 2011. This increase in net assets is comprised of $0.1 billion in investment income, representing a 0.1% rate of return, and contributions of $4.2 billion.
“Despite major equity market indices declining approximately 11% on average, the Fund-s overall quarterly performance benefitted from our active management programs and private market holdings,” said David Denison, President and CEO, CPP Investment Board. “We remain an active and disciplined investor in these challenging market conditions and are prepared to act when the right opportunities arise.”
Five and 10-Year Returns
For the five-year period ended September 30, 2011, the CPP Fund generated an annualized investment rate of return of 3.1% or $19.6 billion of investment income. For the 10-year period ended September 30, 2011, the Fund generated $51.7 billion of investment income reflecting an annualized rate of return of 5.9%.
Investment Portfolio Update
We announced a number of investments during the quarter, including:
We also announced several significant investments following quarter end:
Long-term sustainability
The Chief Actuary of Canada conducts a financial review of the Canada Pension Plan every three years. In the latest triennial review completed in November 2010, the Chief Actuary reaffirmed that the CPP remains sustainable at the current contribution rate of 9.9% throughout the 75-year period of his report. The report also indicates that CPP contributions are expected to exceed annual benefits paid until 2021, providing a 10-year period before a portion of the investment income from the CPPIB will be needed to help pay pensions.
Asset Mix
CPP Investment Board
The CPP Investment Board is a professional investment management organization that invests the funds not needed by the Canada Pension Plan to pay current benefits on behalf of 17 million Canadian contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, the CPP Investment Board invests in public equities, private equities, real estate, inflation-linked bonds, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in London and Hong Kong, the CPP Investment Board is governed and managed independently of the Canada Pension Plan and at arm-s length from governments. At September 30, 2011, the CPP Fund totaled $152.3 billion. For more information about the CPP Investment Board, please visit .
Contacts:
CPP Investment Board
Linda Sims
Director, Media Relations
(416) 868-8695