British Columbia Investment Management Corp., Victoria, delivered an annual net return of 7.4% for the fiscal year ended March 31, compared with a market benchmark of 4.6%.
BCI is the management company for public pension and other provincial assets.
Over the five-, 10- and 20-year periods ended March 31, BCI posted annualized net returns of 8.3%, 9.1% and 7.7%, respectively, BCI said in a news release Thursday.
The five-year performance compared with a benchmark annualized net return of 7.3%, while the 10-year benchmark net return was 8%, and the 20-year benchmark return was a net 6.9%.
BCI's net assets under management increased by C$11.5 billion ($9.2 billion) over the year to C$211.1 billion at the end of fiscal year 2022.
In the previous fiscal year, BCI returned a net 16.5%, below the 17.1% return of the benchmark.
BCI's asset allocation as of March 31 was 37% fixed income, including private debt; 30.5% public equities; 15.9% real estate equity; 11.8% private equity; 9.5% infrastructure and renewable resources; 3.7% real estate debt; and -8.4% other strategies, including "leverage liabilities and client currency policy hedging," based on figures in the news release.
Within fixed income, short-term securities returned a net -0.3% in fiscal 2022, compared with an 0.1% net return for the benchmark; nominal bonds returned a net -3.9% (-4.2% for the benchmark); and private debt, a net 7.3% (2.2% benchmark).
Within public equities, Canadian stocks returned a net 19% in fiscal 2022, under the 20.2% net return for the benchmark; global public equities, 5.7% (9% benchmark) and emerging markets public equities, -10.6% (-11.9%).
Overall, public equities "delivered positive returns as markets continued to rally from 2020 lows," BCI said in the release. Despite "exceptional gains, equity market volatility persisted, influenced by the COVID-19 pandemic and the Russian government's invasion of Ukraine," the firm added.
Within private markets, private equity delivered a net return of 29.7% in fiscal 2022, ahead of its benchmark return of 19.5%; and infrastructure and renewable resources returned a net 12.1% (6.8% benchmark).
With respect to its private equity portfolio, BCI said in the release that "well-timed partial and full exits from direct investments supported the year's strong performance."
The infrastructure and renewable resources segment saw "strong capital appreciation of some of the largest assets in the portfolio, generated through both favorable market conditions and solid business operations."
Within real estate, real estate equity returned a net 14.9% in fiscal 2022, outperforming the benchmark's 6.9% return; while real estate debt returned a net 4% (-0.9% benchmark).
Performance of the real estate equity was "buoyed by strong returns and capital value growth in the second half of 2021, specifically led by momentum in the industrial and residential sectors," BCI said in the release.
The real estate debt portfolio "also experienced significantly higher-than-expected early repayments," BCI noted. "This was driven by a combination of low market interest rates and substantial lender appetite, which enabled borrowers to refinance their loans at lower cost."
Noting that BCI opened an office in New York in early spring for its private equity program, Gordon J. Fyfe, BCI's chief executive officer and chief investment officer, also said in the release that the firm will open an office in London to "support infrastructure and renewable resource investments."
