Foreign gains powered pension asset surge: StatsCan

Pension assets soared on the strength of robust markets in 2021, led by gains in their foreign investments, according to new data from Statistics Canada.

StatsCan reported that the market value of assets held by pension funds surged by 4.2% in the fourth quarter of 2021, pushing the total value of assets under management to $2.27 trillion, up by $92.6 billion.

The biggest asset categories all contributed to the growth. Equities gained 3.6%, bonds were up 3.3%, real estate rose 5.7%, and infrastructure assets added 6.9%.

Foreign assets outpaced domestic assets, gaining 5.0% in the quarter, while domestic assets were up 2.4%, the national statistical agency noted.

Domestic equities were actually down slightly in the quarter, although this was offset by gains in bonds, real estate and infrastructure.

On the other hand, foreign equities were strong, gaining 4.7% in the quarter, the report said. The value of foreign infrastructure assets also jumped 8.6%, and real estate was up 7.3%, it noted.

Alongside the rise in assets, pension funds’ net income also surged. Total revenue rose by 34.5% to $80.8 billion in the fourth quarter.

“The vast majority of this increase was due to an increase in net realized gains on the sale of securities,” StatsCan said.

At the same time, expenditures fell 18.1% to $24.3 billion in the fourth quarter.

As a result, pension fund net income came in at $56.5 billion, up 85.8% from the third quarter.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.