PE and Infrastructure Spur Growth of Caisse de Depot in H1

(August 20, 2010) — Boosted by investments in private equity and infrastructure, Canada’s biggest pension-fund manager, the Caisse de Depot et Placement du Quebec, posted a return of 2.3% in the first half of this year.

The fund stated that the driving factors behind the $4.1 billion in value added included the 14.7% return of its private equity portfolio, 6.0% return of the Caisse’s fixed income portfolios, mostly from corporate and real estate debt investments, 10.1% return of its infrastructure portfolio, and a proactive underweight in equity portfolios. A July report by RBC Dexias investment-services unit shows that the Montreal-based fund manager’s results outpaced the 1.4% average loss of Canadian pensions for the first half of 2010.

The large pension fund manger said it doesn’t expect the volatility of May and June to subside quickly because of continued worries about the strength of the recovery in Europe and the US and a potential slowdown in China. “The markets were challenging and volatile in the first half of the year, with sharp declines in global stock market indicators and significant concerns about European and US economic outlooks,” said Caisse President and Chief Executive Officer Michael Sabia in a statement. “Despite this fact, the Caisse navigated this unfavorable environment well. Our results reflect the work of our asset managers during this period. We find it particularly encouraging that we could produce $4.1 billion in value added compared with the markets,” he added.

As of June 30, Caisse’s net assets under management rose 3.2% to $130.7 billion from $125.5 billion at the end of 2009.