Interest rate levels are critically important to the financial health of defined benefit pension plans. Many DB plans are in their best financial positions in decades, largely due to the dramatic rise in interest rates over the past few years, but decreases in interest rates could pose a major risk for many plans. Changes in […]
As a majority (84 per cent) of Canadian employers say they’re concerned about an emerging retirement income crisis, they also agree that, without access to employer-sponsored pension plans, workers will become a burden on the taxpayer (82 per cent) and the economy will suffer (79 per cent), according to a new survey by the Healthcare […]
Institutional investors don’t have to wait for choppy waters to invest in event-driven credit, according to Duncan Farley, portfolio manager on the BlueRay fixed income team at RBC Global Asset Management, speaking during the Canadian Investment Review’s 2023 Risk Management Conference. While the post-pandemic economy has negatively affected several industries, opportunities always exist for investors to […]
The current economic maelstrom, with its high inflation and interest rates, has left many institutional investors operating in uncharted territory — though not Rashid Maqsood, vice-president of treasury at electrical products distributor Rexel North America Inc. His career began in the late 1970s — almost a decade before central banks began setting inflation targets. “It’s […]
The Caisse de dépôt et placement du Québec generated average returns of negative 5.6 per cent in 2022. “The year 2022 provided an environment filled with several challenges, with spiking inflation, historic interest rate hikes by central banks and rising geopolitical tensions,” said Charles Emond, the Caisse’s president and chief executive officer, during a press briefing […]
More than a quarter (26 per cent) of institutional asset owners expect to use an outsourced chief investment officer in an increased capacity during the next two years, according to a new survey by Cerulli Associates. The survey found 14 per cent of respondents said they’re seeking to establish an OCIO relationship over the next two […]
The Canadian Institute of Actuaries is urging the federal government to reconsider its cessation of real return bond issuances, citing the potential financial impacts to defined benefit pension plans. “We request not only that the decision to cease issuing real return bonds be reconsidered, but also that the annual issuance of real return bonds be […]
The average Canadian defined benefit pension plan lost ground on a solvency and accountancy basis in December, according to LifeWorks Inc.’s latest monthly report. At the end of 2022, the solvency index reached 103.8 per cent, down 3.1 per cent from the end of November. The balance sheet index also fell 2.4 per cent — […]
The average discount rate used by Canadian defined benefit pension plans at the end of 2021 was 0.5 per cent higher than the previous year, according to an annual report from LifeWorks Inc. Drawing from figures submitted by 83 Canadian public DB plans, the report found the average plan used a three per cent discount […]
The use of leverage by U.K. defined benefit pension plans with liability-driven investment strategies left them vulnerable to a sharp rise in bond yields in September, says Erwan Pirou, Canada chief investment officer of wealth solutions at Aon. “Many plans in the U.K. are using leverage in their LDI strategies . . . to reduce […]