Ontario Teachers' Pension Plan to open Hong Kong office
By Bloomberg | November 6, 2012 11:59 am
Ontario Teachers' Pension Plan, Toronto, plans to open a Hong Kong office next year as it diversifies its investments and bridges funding shortfalls.
Deborah Allan, the C$117 billion (US$117 billion) pension fund's director of communications and media relations, declined to give further details in an e-mailed response to a Bloomberg News inquiry, saying plans are not yet finalized.
Ontario Teachers' is among North American retirement funds, including the C$165.8 billion Canada Pension Plan Investment Board, to set up a presence in Asia as they try to tap the region's economic growth. Developing Asian nations are projected to grow 7.2% in 2013, while China is forecast to expand 8.2%, compared with a global growth forecast of 3.6%, according to the International Monetary Fund.
Ontario Teachers reported an investment return of 11% last year, according to its 2011 annual report. Its estimated funding shortfall narrowed to C$9.6 billion, from C$17.2 billion a year earlier, the report showed.
Ontario Teachers has offices in London and New York along with Toronto, according to the annual report.
CPP Investment Board in February hired Mark Machin, former vice chairman for Asia-Pacific region excluding Japan of Goldman Sachs Group (GS), to head its Asian unit. It opened its Asian office in Hong Kong in 2008.
Ontario Teachers invested 79% of its C$51.7 billion public and private equities holdings outside of Canada last year, according to its annual report. Its non-Canadian equities returned 0.2% over the last four years, beating the 2.3% decline of its Canadian equity holdings.
In June, it bought Korea Asset Management's 9.9% stake in Kyobo Life Insurance for about 470 billion won (US$430 million).
Ontario Teachers is seeking private investment opportunities in India, Jane Rowe, its head of private equity, said in July. It made its first foray into the country by investing in Mumbai-based buyout company Kedaara Capital Advisors, she added.