New Brunswick Investment Management Corporation

Pension fund performance rebounds (10/05/31)

NB 841

May 31, 2010

FREDERICTON (CNB) - There has been a strong improvement in the latest investment performance results for the funds under management by New Brunswick Investment Management Corporation (NBIMC).

The NBIMC manages the pension assets of more than 49,000 New Brunswickers, including teachers, judges and public servants.

For the 2009-10 fiscal year, NBIMC has achieved an overall gross rate of return of 19.94 per cent. This is comprised of investment returns for the teachers', judges' and public service plans of 19.99 per cent, 19.89 per cent, and 19.9 per cent, respectively. The returns for the different client pension funds come from the different investment asset mix held by each fund.

While the annualized four-year return is 1.77 per cent, the long-term annualized return since NBIMC's inception in 1996 is now 6.5 per cent.

"Most importantly our annualized real return (after adjusting for inflation) since inception is 4.46 per cent, exceeding the target of four per cent set by the actuary," said John A. Sinclair, president and chief executive officer, NBIMC. "These returns have been achieved in spite of the adverse affects of the prior year's global financial crisis.

"By maintaining our long-term investment strategy, and not having to liquidate investments during last year's downturn, we were positioned to participate in the very impressive rebound in global financial markets."

Net assets under management as of March 31, 2010, were $8.341 billion, up from $7.029 billion as of March 31, 2009. The increase in net assets under management resulted from $1.384 billion in net investment valuation gains, plus $150 million in special funding payments from the plans' sponsors, less net pension payouts of $223 million.

"Defined benefit pension plans derive a significant portion of their ultimate pension payments from investment returns," said Sinclair. "Achieving these returns requires an investment strategy capable of delivering the required return as set by the pension fund actuary with the minimum amount of risk. We have designed our investment program to meet the long-term growth requirements of the funds while providing some protection against the ongoing global economic challenges.

"We recognize that a primary concern of pension plan members is the safety of their future pension payments. The asset mix of each plan has also been developed to allow us to make the annual net pension payments for many years in the future while providing opportunity for accessing additional investment gains such as occurred this year."


MEDIA CONTACT: John A. Sinclair, president and chief executive officer, New Brunswick Investment Management Corporation, 506-444-5800.