york university pension fund leona fields manager, pension fund

York University Pension Fund

Leona FieldsManager, Pension Fund

Annual Pension MeetingApril 24, 2009

2

Quick Facts

• One pension plan for all York University faculty and staff

• Plan membership

– Active: 4,330

– Deferred: 1,320

– Retired: 1,700

• In 2008

– $ 52.8 M in contributions in

– $ 60.3 M in benefits paid out

– $ 8.6 M in expenses

• 2008 rate of return -19.2% net

• Current value of the Pension Fund is just over $1.0 Billion

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Pension Plan Overview

• Hybrid Pension Plan: DC and DB combined• Members and University make contributions (DC part)• All contributions are invested in the Fund and earn the

Fund rate of return• At retirement, the pension amount is calculated from the

accumulated value of the the member’s Money Purchase account– The minimum pension amount is calculated from a formula

based on member’s salary and years of service (DB part)

• Throughout retirement, pensions are adjusted annually by the excess of the 4-year Fund return over 6% – Pensions paid will NEVER be reduced

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Key Differentiating Factors for York Pension Fund

• Primarily a Defined Contribution Plan – But members do NOT have investment options

• Benefits depend on investment returns– Adjustments after retirement continue to depend on investment

returns – not inflation

• Investment policy decisions must consider multiple risk profiles– Plan Sponsor– New plan members– Members close to retirement– Retirees

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Pension Fund Investment Overview

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Asset Mix

Cdn Equity20%

Int'l Equity15%

Cdn Bonds

30%

U.S. Equity15%

Infrastructure10%

Global Equity10%

Manager Structure

Addenda10%

Foyston Gordon &

Payne7%

Alliance Bernstein

10%

WEDGE5% TD Bonds

25%

GIP2.5%

Macquarie2.5%

LSV10%

McLean Budden

7%

Sceptre6%

Gryphon5%

TD U.S. Equity10%

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York’s Pension Governance - Internal

• Plan/Benefits side– Board of Governors– Vice President, Finance & Administration– Pension & Benefits Office– All University Committee on Pensions

• Fund/Investments side– Pension Fund Board of Trustees– Sub-Committee on Investment Performance– Pension Investment Staff

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York’s Pension Governance - External

• Investment Managers• Custodian - CIBC Mellon• Auditor - Ernst & Young• Investment Consultant - Towers Perrin• Actuary - William M. Mercer• Pension Administration System – Seclon Logic• Lawyer – McCarthy Tétreault

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What Happened in 2008?

Fund Performance

-23.3%

-15.3%

-8.1%

3.3%

21.1%

0.7%

-15.7%

-33.4%-29.9%

-46.5%

-18.8%

2.4%

-1.8%

0.9%

-10.0%

-25.2%-24.3%

5.2% 3.3%

-5.4%

4.8% 3.6%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%C

anad

ian

Equ

ity

US

Equ

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Inte

rnat

iona

l Equ

ity

Glo

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quity

Bon

ds

Infr

astr

uctu

re

Cas

h

Cur

renc

y H

edge

Tot

al F

und

Q408 2008 4 Years

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What’s in store for 2009?

• Instability in the markets continues– Some positive signs but likely still a long way until we’re out of

the woods

• Key Initiatives for 2009 – Investment in Infrastructure funds and selection of additional

Infrastructure manager– Implementation of Active Currency Hedge– Risk Management / Asset Allocation Review Project

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Contact Information

Leona Fields

Ext. 55122

fieldsl@yorku.ca

http://www.yorku.ca/finance/divisions/pensioninvestments.htm