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. <\/p>\n
The 10-per-cent return combines the performance of Victoria-based BCI\u2019s six largest pension-plan clients for the year that ended March 31. <\/p>\n
In a \u201check of a year\u201d marked by upheaval in investing markets, \u201cwe had a good year,\u201d Ramy Rayes, the fund\u2019s executive vice-president of investment strategy and risk, said in an interview. BCI added $21.9-billion of investment income after fees. <\/p>\n
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 <\/b>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.<\/p>\n
Over 10 years, BCI has earned an average annual return of 7.4 per cent, ahead of its benchmark of 7.1 per cent.<\/p>\n
BCI now manages $295-billion of gross assets, compared with $250-billion a year earlier. After subtracting real estate debt and other liabilities, BCI\u2019s net assets are $251.6-billion. <\/p>\n
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. <\/p>\n
By contrast, \u201cwe had quite a year in terms of deployment\u201d of capital, Mr. Rayes said. <\/p>\n
\u201cPeople think the market is kind of jammed and low deal activity. We\u2019re not seeing that,\u201d he added. <\/p>\n
BCI\u2019s 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<\/a>, which sold for $5-billion to Bell Canada parent BCE Inc. BCE-T<\/a>, and a 60-per-cent stake<\/a> in European alternative asset manager Hayfin Capital Management. <\/p>\n The fund\u2019s 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. <\/p>\n \u201cWe stayed active,\u201d Mr. Rayes said. \u201cWe\u2019re seeing so many opportunities right now, good opportunities, I would say at good value.\u201d<\/p>\n 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.<\/p>\n Fewer of BCI\u2019s new investments have been in the United States, where 39 per cent of the pension fund\u2019s assets are invested, as uncertainty over tariffs and potential tax changes shifts the balance of risk and return.<\/p>\n \u201cIn some cases it\u2019s been challenging to deploy in the U.S. and we\u2019ve been prudent, and we\u2019ve put things on pause at BCI,\u201d Mr. Rayes said. <\/p>\n