The British Columbia Investment Management Corp. has reported a 12.4 per cent return for its fiscal year ended Mar. 31, 2017, a significant increase from the negative 0.2 per cent it reported the previous year but still not as high as its 14.2 per cent result in 2015.
The pension investment corporation noted infrastructure, private equity, real estate and renewable resources outperformed for the calendar year, delivering above-benchmark returns. Other key contributors were the strong performance of global equities, the decision to underweight nominal bonds and a strong performance in illiquid asset investments.
Read: B.C. Investment Management Corp. sees return drop 14 percentage points
“I am proud of the bcIMC team and the strategic investment decisions they made to generate $680 million in additional value, as well as deploying new capital into long-term investments. This is a significant contribution to securing our clients’ financial futures,” said Gordon J. Fyfe, bcIMC’s chief executive officer and chief investment officer, in a news release.
“Although annual returns provide us with a short-term perspective, it is the longer term that matters. Over the 20-year period, we have exceeded their actuarial return requirements and have added $7.7 billion in cumulative value add.”
Read: bcIMC posts 14.2% return for 2015
bcIMC noted a number of highlights in fiscal 2017, including:
- The commitment of $9.9 billion to illiquid assets — infrastructure, mortgages, private equity and real estate;
- The establishment of its QuadReal Property Group, an in-house real estate asset and property manager;
- The transition of $2.8 billion of externally managed public equity funds to bcIMC; and
- The expansion of its team by 74, adding expertise in asset management, data governance, derivatives, illiquid assets, portfolio management, quantitative analysis and tax.
Read: B.C. pension fund launches in-house real estate management arm
bcIMC also noted the cost-effectiveness of its transition to become an in-house asset manager, with less reliance on third parties.
In fiscal 2017, the pension fund increased its managed net assets to $135.5 billion, an increase of $13.6 billion from the previous year.