queen’s pension plan annual general meeting december 5, 2014
TRANSCRIPT
Agenda
• Members of Queen’s Pension Committee• Summary of Pension Plan Membership• True vs. Paid Pensions• Financial Position of Queen’s Pension Plan – Going Concern Basis• Financial Position of Queen’s Pension Plan – Wind-Up/ Solvency
Basis• Pension Plan Asset Reconciliation• Summary of Plan Assets at August 31, 2014• Returns Compared to Benchmark and BNY Mellon’s Universe• Returns Compared to Other Canadian University Pension Plans• Manager Presentation: Orbis Investment Advisory (Canada)• Questions
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Members of Queen’s Pension Committee
• Appointed by Memberso James MacKinnono Bill Cannono Peggy Hauschildto Alison Morgano John Gordono Kelly Sedore
• Appointed by Board of Trusteeso David Graceo Don Raymondo Peter Copestakeo Kathryn Busho Jill Wagman
• Ex Officioo Daniel Woolfo Barbara Palko Caroline Daviso Al Ortho Jim Leech
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Summary of Pension Plan Membership
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Active Deferred
Pensioners and
Survivors
Total
At August 31, 2013 3,644 1,638 2,049 7,331New entrantsReturn to active statusMarriage breakdowns
3548 (3)
1
35451
Terminations o Transfers/lump
sum(44) (48) (92)
o Deferred pensions (134) 134 Deaths (5) (3) (64) (72)Retirements o Pension option (98) (29) 127 o Lump sum (3) (13) (16)New beneficiaries 2 19 21Other (10) (4) (14)At August 31, 2014 3,722 1,668 2,128 7,518
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True vs. Paid Pensions
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Base monthly pension through Aug31/07: $2,934.66
Current year return (as at August 31, 2014): 17.7093% Going forward: 6%
Plan Year Fund return Excess interest (EI) True pension + EI
2007-08 -4.3700% 2.2266%$3,000.00
2008-09 -7.8877% -4.2469%$2,872.60 95.8% of $3,000 (paid) pension
2009-10 6.8470% -4.7409%$2,736.41 91.2% of $3,000 (paid) pension
2010-11 6.3370% -5.9794%$2,572.79 85.8% of $3,000 (paid) pension
2011-12 5.5286% -3.4859%$2,483.10 82.8% of $3,000 (paid) pension
2012-13 14.5535% 2.2571%$2,539.15 84.6% of $3,000 (paid) pension
2013-14 17.7093% 4.9094%$2,663.81 88.8% of $3,000 (paid) pension
2014-15 6.0000% 4.8214%$2,792.24 93.1% of $3,000 (paid) pension
2015-16 6.0000% 4.9450%$2,930.32 97.7% of $3,000 (paid) pension
2016-17 6.0000% 2.8133%$3,012.76 100.4% of $3,000 (paid) pension
True pension
Paid pension
Financial Position of Queen’s Pension Plan:Going Concern Basis ($000’s)
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August 31, 2011August 31, 2013 (est.)AssetsMarket value of assets $1,315,319 $1,527,573 Smoothing adjustment $19,686 ($43,815)Net assets at market value $1,335,005 $1,483,758
LiabilitiesMarket value of:
- DC accounts $593,045 $676,481 - Past service accounts $24,908 $24,879 - Voluntary accounts $37,047 $38,940
Present value of accrued benefits:- Active members $55,646 $70,901 - Pensioners/survivors $750,770 $817,169
Total liabilities $1,461,416 $1,628,370
Surplus (deficit) ($126,411) ($144,612)
Financial Position of Queen’s Pension Plan:Solvency Basis ($000’s)
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August 31, 2011 August 31, 2013 (est.)Assets Market value of assets $1,315,319 $1,527,573 Termination expense ($2,000) ($2,000)Net assets at market value $1,313,319 $1,525,573
Liabilities Market value of:
- DC accounts $593,045 $676,481 - Past service accounts $24,908 $24,879 - Voluntary accounts $37,047 $38,940
Present value of accrued benefits:
- Active members $112,509 $123,042 - Pensioners/survivors $878,079 $954,017
Total liabilities $1,645,588 $1,817,359
Surplus (deficit) ($332,269) ($291,786)
Pension Plan Asset Reconciliation ($000’s)
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September 1, 2013 $ 1,527,573
PLUSMembers’ DC contributions 21,754 University’s DC contributions 18,599 University’s Minimum Guarantee contributions 4,930 University’s Past Service contributions 15,122 Voluntary contributions 1,309 Past Service contributions 82 Transfers from other plans 1,262 Investment return 277,106
LESSPensions paid (80,297)Lump-sums paid (12,690)Administration fees (8,627)
August 31, 2014 $ 1,766,123
Gross rate of return 18.33%Rate of return net of expenses 17.71%
Summary of Pension Plan Assets at October 31, 2014
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Canadian Equity
Global Equity
Fixed
Income
Real Estate
Infra-structu
reTotal Assets
Percent of Total Assets
Burgundy$166,75
4$166,75
4 9.4%Guardian $82,347 $82,347 4.8%Connor, Clark, & Lunn $84,841 $84,841 4.9%TD Asset Management $3,704 $3,704 0.2%
Letko, Brosseau $56,414 $83,692 $73,486 $213,59
2 12.4%
Manning & Napier $166,106 $166,10
6 9.6%
Orbis $183,758 $183,75
8 10.6%State Street Global Advisors $175,039
$175,039 10.1%
Beutel Goodman$176,36
4 $176,36
4 10.2%
PIMCO$208,48
0 $208,48
0 12.1%Integrated Private Debt
$101,114
$101,114 5.9%
Real Estate – Oxford $82,162 $82,162 4.8%Infrastructure - Borealis $84,490 $84,490 4.9%
Total Assets$394,06
0$608,59
5$559,4
44 $82,162$84,49
0$1,728,
751 100.0%% of Total Assets 22.6% 35.2% 32.5% 4.8% 4.9% 100% 100.0%
QPP Returns Compared to Benchmark &BNY Mellon’s Universe of Canadian Pension Plans
• At September 30th, 2014:
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3 Months 1 Year 4 Years 10 Years
Queen’s 0.3% 14.3% 10.1% 7.6%
Benchmark 1.7% 15.4% 8.6% 6.8%
BNY 1st quartile 1.7% 16.2% 10.5% 7.7%
BNY Median 1.3% 15.0% 9.6% 7.2%
BNY 3rd quartile 0.8% 13.6% 8.8% 6.9%
QPP Returns Compared to Other Canadian University Pension Plans
• CAUBO survey results, as at December 31, 2013:
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1 year2
years4
years10
years
Queen’s 19.4% 14.9% 9.6% 7.3%
Assets > $500M 15.2% 12.6% 9.2% 7.0%
Assets $150M-$500M 15.1% 12.3% 8.6% 6.9%
Assets $30M-$150M 16.0% 12.3% 8.4% 6.6%
All Equally Weighted 15.1% 12.2% 8.8% 6.9%
All Dollar Weighted 15.1% 12.4% 8.8% 6.3%