Employer pension plans (trusteed pension funds), third quarter 2019
The market value of assets held by Canadian trusteed pension funds increased 1.6% from the second quarter to $2.04 trillion in the third quarter, up 7.3% compared with the third quarter a year earlier.
The market value of investments in bonds (+3.1%), stocks (+2.1%), mortgages (+1.5%) and real estate (+1.2%) was up in the third quarter, while short-term investments (-2.4%) were down and other assets (-0.1%) were relatively flat.
Private sector assets grow at a faster pace than public sector assets
The market value of assets held in private sector funds was up 2.3% in the third quarter, while the value of public sector funds increased 1.3%. Year over year, private sector assets rose 9.4% compared with a 6.4% increase in public sector assets.
Domestic investments show strong annual growth
Domestic holdings edged closer to $1.3 trillion in the third quarter, up 1.4% from the previous quarter. Stocks (+3.2%) and bonds (+2.4%) were up, while short-term investments (-1.7%) and other assets (-0.3%) fell. Year over year, the value of domestic assets grew 8.6%.
Foreign investments rise on the strength of stocks and bonds
The value of foreign investments increased by $14.8 billion, or 2.0%, in the third quarter to $744.4 billion, accounting for just over one-third (36.7%) of total assets at the end of the quarter.
While short-term investments fell 18.5% in the third quarter, bonds increased 8.6% to $78.9 billion, stock holdings rose 1.5% to $354.8 billion and other assets increased 1.3% to $308.1 billion. Year over year, the value of foreign assets grew 5.1%.
Net income increases
Pension fund revenue from contributions was down 13.4% in the third quarter, but this was more than offset by growth in net profit on sales of securities (+17.9%) and investment income (+3.6%), as total revenue in the third quarter increased 5.1% to $50.0 billion. At the same time, expenditures fell 4.2% to $22.3 billion, mainly due to lower pension payments (-3.3%) and administration costs (-4.7%). This resulted in net income of $27.7 billion, up 14.1% from the second quarter and 48.2% higher year over year.
Note to readers
For the purposes of this survey, trusteed pension funds include the assets of one or more registered pension plans: those held under a trust agreement, those held by a pension corporation or pension fund society, those administered under legislation by the Government of Canada or the government of a province of Canada, and those held by an insurance company for investment management only.
Excluded from the survey are pension funds held in total under an annuity insurance contract.
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