The Victoria-based company responsible for B.C.B次元官网网址檚 public-sector pensions saw its funds grow by 16.5 per cent during fiscal 2021 B次元官网网址� one of the most positive pandemic-year returns for a provincial pension management company in Canada.
British Columbia Investment Management Corporation (BCI) increased its assets under management by $28.3 billion to $199.6 billion. The assets contribute three-quarters of every $100 spent on retirement benefits to the 690,000 pension-collecting retirees of B.C.B次元官网网址檚 public sector.
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By comparison, the Investment Management Corporation of Ontario and Alberta Investment Management Corporation saw increases of 5.4 per cent and 2.5 per cent, respectively, during fiscal 2020 according their annual reports.
| The B.C. Investment Management Corporation has a prominent home in downtown Victoria across from city hall. (Kiernan Green/B次元官网网址 Staff) |
February and March 2020 B次元官网网址� the early months of the pandemic B次元官网网址� showed a worse national market downturn than that seen during the 2008-10 global recession, with over one million jobs lost in a one-month period, according to Statistics Canada.
Despite that performance, investment and management decisions committed at BCI in the last six years resulted in even higher returns done 2021 than the company achieved in 2015 (14.2 per cent) B次元官网网址� along with the full funding of clientsB次元官网网址� pensions throughout the pandemic.
The timing of some of those decisions, CEO/CIO Gordon J. Fyfe told Black Press Media, was nothing short of fate.
Victoria native Fyfe was appointed to manage BCI in 2014 and within months of his arrival, the board of directors greenlit a new strategy for managing their clientsB次元官网网址� pensions. It drew on the federal governmentB次元官网网址檚 Public Sector Pension Investment Board, for which Fyfe was CEO for 11 years in Montreal.
The strategy, Fyfe said, began with expanding the companyB次元官网网址檚 international portfolio. BCIB次元官网网址檚 investments in U.S. assets increased by 14.7 per cent since 2015, according to their annual reports.
B次元官网网址淲eB次元官网网址檝e reduced our weighting in offices and our weighting in shopping centres (infrastructure investments), and weB次元官网网址檝e increased significantly our weighting in things like warehouses,B次元官网网址� he said. B次元官网网址淪o Amazon is a big partner of ours.B次元官网网址�
According to StatsCan, online shopping, and thus, the use of warehouse distribution centres, has increased 94.8 per cent throughout the pandemic.
In 2015, Canadian investments made up over half of BCIB次元官网网址檚 portfolio.
B次元官网网址淭heyB次元官网网址檇 done really well, but it was overweighted compared to the role of CanadaB次元官网网址檚 economy in the world,B次元官网网址� Fyfe said, noting that Canada comprises just 1.4 per cent of the worldB次元官网网址檚 gross domestic product. Today, BCIB次元官网网址檚 Canadian investments account for just over a third of global assets, but remain their largest investment region.
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There was also the fateful decision to sell several airport and hotel investments in 2016, including the Delta Hotel brand name, which would go on to plummet in value with the onset of pandemic travel restrictions.
B次元官网网址淚n many cases, itB次元官网网址檚 not about what we owned but what we didnB次元官网网址檛 own,B次元官网网址� Fyfe said with regard to their successful pandemic-year return.
The hiring of in-house asset management was the second half of BCIB次元官网网址檚 strategy half a decade in the making. Before 2016, nearly all of that work was given to outside financiers, Fyfe noted. Since then, he said, a team of newly hired asset managers has freed up $3 billion in fees back into investments and the payrolls of around 400 new hires.
B次元官网网址淚t certainly helps the economy. We now have 600 people managing $200 billion based here in Victoria. Rather than everybody around the world taking that money from our pensioners, that moneyB次元官网网址檚 staying here in the province.B次元官网网址�
Evoking the words of Bank of Canada governor Tiff Macklem, Fyfe said itB次元官网网址檚 easier to shut down an economy than it is to start it up again.
B次元官网网址淭hatB次元官网网址檚 exactly whatB次元官网网址檚 happened,B次元官网网址� he said. As the country begins its pandemic recovery and typical spending resumes, BCI intends to monitor the inflation of its investments.
B次元官网网址淟arge parts of our portfolio are inflation-sensitive and theyB次元官网网址檒l do fine with an inflationary environment,B次元官网网址� Fyfe said.
Do you have a story tip? Email: kiernan.green@blackpress.ca.
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