CPP Reserve Fund Returns 5.2% in Q4

February 11, 2005 (PLANSPONSOR.com) - The Canada Pension Plan (CPP) earned 5.2% - or $3.9 billion - in returns for the fourth quarter of 2004.

This brought the CPP reserve fund to $77.2 billion, consisting of $43.8 billion in public and private equities, real estate and infrastructure, and $33.4 billion in bonds.

Equities and real-return assets comprise 56.7% of the fund, and consist of over 52% publicly traded stocks, 3.2% private equities, 1% real estate and 0.1% infrastructure. Equities accounted for $3 billion of the fourth quarter returns in the fund.

Nominal fixed-income makes up the remaining 43.3% of the reserve fund, and consists of 37.1% federal and provincial bonds and 6.2% in cash and money markets. These asset returned $890 million in the fourth quarter, or 2.6%.

The CPP now predicts that contributions will exceed benefits until 2022, giving it 17 years before a portion of investment income will be needed to help pay benefits, according to the Canadian Broadcasting Corporation. This is a year longer than actuaries had previously predicted, the national news service said.