British Columbia Investment Management Corp. earned an average return of 10 per cent for clients last fiscal year, missing its internal benchmark but showing its ability to make deals in a volatile market.

The 10-per-cent return combines the performance of Victoria-based BCI’s six largest pension-plan clients for the year that ended March 31.

In a “heck of a year” marked by upheaval in investing markets, “we had a good year,” Ramy Rayes, the fund’s executive vice-president of investment strategy and risk, said in an interview. BCI added $21.9-billion of investment income after fees.

The internal benchmark BCI uses to measure its performance gained 12.3 per cent. BCI is one of several large Canadian pension funds with broad portfolios of public and private assets that have struggled to keep pace with benchmarks focused on public equities, most notably large U.S. technology companies that have surged in value.

Over 10 years, BCI has earned an average annual return of 7.4 per cent, ahead of its benchmark of 7.1 per cent.

BCI now manages $295-billion of gross assets, compared with $250-billion a year earlier. After subtracting real estate debt and other liabilities, BCI’s net assets are $251.6-billion.

Many large investors have lamented the uncertainty plaguing markets, which has dampened deal-making and made it a hard year to put money to work.

By contrast, “we had quite a year in terms of deployment” of capital, Mr. Rayes said.

“People think the market is kind of jammed and low deal activity. We’re not seeing that,” he added.

BCI’s private-equity group, which earned a 13.4-per-cent return, made $2.2-billion of new investments and sold two of the largest assets in its portfolio: a stake in internet provider Ziply Fiber, which sold for $5-billion to Bell Canada parent BCE Inc. BCE-T, and a 60-per-cent stake in European alternative asset manager Hayfin Capital Management.

The fund’s infrastructure and renewable-resources portfolio, which gained 8.3 per cent last year, made $5.1-billion of new investments, including taking BBGI Global Infrastructure SA private for $1.9-billion.

“We stayed active,” Mr. Rayes said. “We’re seeing so many opportunities right now, good opportunities, I would say at good value.”

The lone portfolio that lost money for BCI was its equity investments in real estate, which fell 1.8 per cent as assets were marked down in value. The real estate debt arm earned a 6.1-per-cent return.

Fewer of BCI’s new investments have been in the United States, where 39 per cent of the pension fund’s assets are invested, as uncertainty over tariffs and potential tax changes shifts the balance of risk and return.

“In some cases it’s been challenging to deploy in the U.S. and we’ve been prudent, and we’ve put things on pause at BCI,” Mr. Rayes said.

That is partly because of potential U.S. tax changes that would significantly raise tax bills for foreign investors. Senators have pushed to delay the implementation of the tax until 2027, but Canadian pension funds eyeing new, long-term investments have started to factor the tax into their decisions anyway.

“We price it in,” Mr. Rayes said, echoing recent comments by Canada Pension Plan Investment Board CEO John Graham.

“It doesn’t mean that we’re stopping investing [in the U.S.] but we’re certainly intentionally creating new partnerships in Europe and Asia,” Mr. Rayes added. “We want to make sure that we have a good, diversified portfolio.”

Even though BCI missed its fiscal-year benchmark, Mr. Rayes said he trusts that the pension-fund manager’s allocations to private-equity investments and other private assets will match up over the longer term.

“I don’t believe public equity will do 30-per-cent returns over 10 years. I really don’t,” he said, referring to outsized stock market gains driven by shares in major U.S. tech companies.

“I feel comfortable with it, but it does create that noise on a shorter-term period.”