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Employer pension plans (trusteed pension funds), third quarter 2020

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Released: 2021-02-16

After a drop in the first quarter, coinciding with the onset of the COVID-19 pandemic, and a quick rebound in the second quarter, the market value of assets held by Canadian trusteed pension funds increased to $2.12 trillion in the third quarter, exceeding its pre-pandemic level. This was up 2.1% from the second quarter and up 4.2% year over year.

All asset categories, except short-term assets (-6.4%), rose in the third quarter. Stocks posted the largest increase (+5.8%), followed by mortgages (+5.1%), real estate (+2.7%) and other assets (+2.0%). Bonds were relatively flat (+0.2%).

Domestic assets rose 1.5% over the previous quarter and were up 6.6% year over year. Foreign assets increased 3.2% compared with the second quarter, but were down 0.2% year over year.

Net income back in line with historical levels

Following a loss in the first quarter of 2020 (-$6.1 billion) and a slight rebound in the second quarter (+$7.7 billion), the net income of Canadian trusteed pension funds returned to pre-COVID-19 levels in the third quarter, at $31.1 billion.

Total revenue rose $19.1 billion from the second quarter to $55.0 billion in the third quarter (+53.3%), driven mainly by higher profits on the sale of securities (+305.7%) as markets recovered in the third quarter. Total contributions were down 1.7%, with employer contributions (+2.3%) partially offsetting the drop in employee contributions (-7.8%).

Expenditures fell by $4.3 billion (-15.2%) to $23.9 billion. This was mainly because of a decline in the level of losses on the sale of securities ($158.5 million), compared with losses of $3.9 billion in the previous quarter.

Domestic and foreign investments both up

The total value of domestic holdings rose 1.5% in the third quarter, to $1.4 trillion, and was up 6.6% year over year.

The market value of two of the largest categories of domestic assets—bonds (-0.5%) and miscellaneous (-1.9%)—was down. This decrease was more than offset by gains in the other three largest categories, bond funds (+2.4%), real estate (+2.1%) and equity funds (+5.6%).

Foreign assets rose 3.2% in the quarter to $713.0 billion on the strength of the two largest asset categories, pooled assets (+3.6%) and stocks (+4.4%). However, foreign bonds were down 2.4% and foreign short-term investments fell 26.0% in the third quarter. Year over year, foreign assets were down $1.5 billion (-0.2%).

Private sector slightly outperforms public sector

The market value of assets held by both private and public sector trusteed pension funds rose 2.1% in the third quarter. Private sector assets increased 4.6% year over year to $654.3 billion, while public sector assets nearly hit $1.47 trillion, up 4.0% 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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The Income, pensions, spending and wealth portal, which is accessible from the Subjects module of the Statistics Canada website, provides users with a single point of access to a wide variety of information related to revenue, pensions, spending and wealth.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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