The Universities Academic Pension Plan is withdrawing control of its $2.7-billlion public equities portfolio from the Alberta Investment Management Corp.
The withdrawal comes following ongoing discussions at the UAPP about the AIMCo’s public equities strategy and the investment manager’s volatility trading program that was wound down in 2020, says Geoffrey Hale, chair of the UAPP’s board of trustees. He says the withdrawn funds will be transferred to an indexing or passive strategy until new money managers are selected, following a revised asset-liability study to be conducted by the UAPP this year.
“As a result of the interaction of all these factors, it was decided by the [UAPP’s] investment committee and the board to recommend AIMCo’s management of public equities be ended,” he says.
The withdrawal won’t affect members’ pensions, says Hale. The AIMCo will continue to manage the UAPP’s other portfolios, including infrastructure, private debt, private equity and real estate, he adds. “If there’s concerns, we raise them internally. And if they’re addressed effectively, we can carry out our fiduciary responsibility and the managers retain our confidence.”
In an emailed statement to Benefits Canada, the AIMCo said it respects the UAPP’s decision and will continue to serve the pension plan’s other investment management needs. “AIMCo worked closely with UAPP to ensure an efficient transfer of assets that would in no way impair the performance of the public equities portfolio for AIMCo’s other clients.”
Last month, the AIMCo reported a total fund return of 2.5 per cent net of all fees for 2020, approximately 5.4 per cent below that of its benchmark. Evan Siddall will succeed Kevin Uebelein as the AIMCo’s chief executive officer on July 1. Last November, Uebelein and the AIMCo board began the process of a leadership transfer after the CEO announced he would step down early.