November 09, 2006
Toronto (November 9, 2006): The CPP fund, which includes investment earnings and CPP contributions not needed to pay current pensions, grew by $4.7 billion to $103.3 billion during the quarter ending September 30, 2006.
For the quarter, the CPP fund experienced an investment rate of return of 3.9 per cent, or an increase of $3.9 billion, while the fund added $0.8 billion from CPP contributions not needed to pay current pensions. The result is a $4.7 billion overall increase in the CPP fund since June 2006.
For the first half of the fiscal year, the CPP fund experienced an investment rate of return of 1.3 per cent, or $1.4 billion, while the fund added $3.9 billion from CPP contributions not needed to pay current pensions. The result is a $5.3 billion overall increase in the CPP fund from April 1, 2006 to September 30, 2006.
“In surpassing $100 billion in assets, we mark a milestone in the growth and evolution of the CPP fund,” said David Denison, President and CEO, CPP Investment Board. “Within the next decade, the Chief Actuary of Canada estimates that the CPP fund will grow to $250 billion, making it one of the largest single purpose pools of investment capital in the world.”
At September 30, 2006, the CPP fund consisted of equities—63.7 per cent ($65.9 billion), of which public equities made up 58.3 per cent ($60.3 billion) and private equities 5.4 per cent ($5.6 billion); bonds—24.9 per cent ($25.6 billion); inflation-sensitive assets—9.7 per cent ($10 billion); and cash and cash equivalents—1.7 per cent ($1.8 billion).
CPP contributions are expected to exceed annual benefits paid until 2022, providing a 16-year period before a portion of the investment income is needed to help pay CPP benefits.
CPP Investment Board
The CPP Investment Board invests the funds not needed by the Canada Pension Plan to pay current benefits. With a mandate from the federal and provincial governments, the CPP Investment Board is accountable to Parliament, to the federal and provincial finance ministers who serve as the stewards of the CPP and to 16 million contributors and beneficiaries. Based in Toronto, the CPP Investment Board is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. Its fiscal year is from April 1 to March 31. For more information about the CPP Investment Board, visit www.cppib.ca.
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