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(April 1, 2008) Great-West Life & amp; Annuity Insurance Company, the U.S. subsidiary of Great-West Lifeco, has completed the sale of its healthcare business. The sale of Great-West Healthcare to a subsidiary of CIGNA Corporation will allow the Great-West Life & Annuity to focus on financial services.

“Great-West Lifeco has been pursuing a strategy to expand its financial services business in the United States, and this transaction — along with our acquisition in 2007 of Putnam Investments — is a major strategic step forward,” said Raymond L. McFeetors, president and CEO of Great-West Lifeco. “Going forward in the U.S., Lifeco will focus on the financial services business and, in particular, asset accumulation, asset administration and fund management.”

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Teachers’ beats benchmark

(April 1, 2008) The Ontario Teachers’ Pension Plan, one of the largest institutional investors in Canada, has announced that it topped its benchmark in fiscal 2007, earning an annual return of 4.5%. Its composite benchmark earned 2.3%.

To put that into perspective, the gain put an additional $2.3 billion into the fund, raising its total asset value to $108.5 billion.

“Diversification has always been a hallmark of our investment program, and our real estate, private equity and infrastructure assets led the way with our tactical asset allocation and absolute return strategies in producing a 4.5% total fund return, decisively outperforming the 2.3% composite benchmark,” said Jim Leech, president and CEO.

This is the eighth consecutive year that the fund’s managers have beaten their benchmark. The fund’s composite benchmark tracks standard indexes for Canadian and foreign markets and real rate returns for inflation-sensitive assets, all in proportion to the fund’s asset-mix policy.

The pension plan does face challenges, however, as it is currently paying out $4 billion in benefits, while receiving only $2.1 billion in contributions. There are also only 1.6 active members of the pension for every retired member.

“The result is that our fund cannot afford the investment risk that it once did,” said Leech. At the end of 2007, the equity allocation of the fund had fallen to 47%, compared to 65% in 1995.

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Alberta business sentiment rises

(April 1, 2008) Alberta business leaders are looking forward to the second quarter, according to the latest survey of business sentiment by the Western Centre for Economic Research and ATB Financial.

The survey found that the sentiment index bounced from a two-year low of 124.7 in the first quarter, to 130.5 for the second quarter. Any index value above 100 indicates positive sentiment. The new reading is still down from 140.3 in the second quarter of 2007.

“Alberta’s businesses are certainly feeling less optimistic about general conditions than they did a year or two ago,” says Todd Hirsch, the senior economist at ATB Financial. “However, attitudes are still positive. Compared to the U.S. and central Canada, sentiment among the business community in Alberta remains very strong.”

Sentiment is lowest among those in the energy sector, which fell to a reading of 74, reflecting the falling prices of crude oil. The readings for construction and professional/technical businesses also took a hit.

The best gains were in the manufacturing, transportation and warehousing, and wholesale sectors.

(04/01/08)