Canada Post Corp.’s defined benefit pension plan’s assets declined 6.7 per cent in 2022, according to its latest annual report
“2022 was a turbulent year for financial markets,” said Jan Faryaszewski, chief financial officer at the Canada Post pension plan, in the report. “The DB component of the plan fell from $32.3 billion to $29.5 billion. At the same time, the DB component showed strong relative performance [over the benchmark portfolio].”
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During the year, the 104,000 member DB plan’s performance was led by its alternative investment allocations, with the value of private equity investments returning 33.8 per cent, following by infrastructure (21.8 per cent) and real estate (11.4 per cent).
Allocations to public markets saw generally negative returns. Holdings in international equities fell 11 per cent, followed by U.S. equities (10 per cent) and Canadian equities (4.6 per cent). The plan’s bond
portfolio saw even steeper losses, with nominal bonds finishing the year down 18.5 per cent and real return bonds decreasing 14.3 per cent.
Despite the decline in asset value, the DB plan’s funded and solvency ratios increased as liabilities declined. The funded ratio rose from 120 per cent to 127 per cent and the solvency position improved from 92.6 per cent to 108.7 per cent.