Vestcor reports positive 2018 client returns during a challenging market environment | June 17, 2019
June 17, 2019
Vestcor Inc. (Vestcor) has released its 2018 Annual Report, which reflects the successful amalgamation on January 1, 2018 of its predecessor companies, Vestcor Investment Management Corporation (VIMC) and Vestcor Pension Services Corporation (VPSC). Vestcor operates as a private, not-for-profit company offering global investment management and pension and benefit administration services to public sector entities.
“Despite difficult market conditions, especially during the last quarter of 2018, we are proud to announce that Vestcor has been able to achieve positive investment performance for our clients” said John A. Sinclair, President and Chief Executive Officer. “Our clients frequently cite capital preservation as a key objective for their investment strategies. Despite a negative market environment for risk assets in 2018, we are pleased to have delivered on that objective during the year.”
The Annual Report also outlines that Vestcor successfully exceeded the key performance targets of their administrative clients during the year despite an overall 13% increase in pension and benefit applications.
“We are also proud to have continued to offer management and administration services that are very cost effective versus other public sector peers” declared Mr. Sinclair.
Further investment disclosure reports a 2.08 percent overall gross investment return for total assets under active management for the year ended December 31, 2018, with a management expense ratio of approximately 0.12 percent. “Our not-for-profit business model continues to provide low cost, efficient investment and administration services for our clients” said Sinclair. Pension Funds under active management specifically achieved an overall 2018 return of 2.07 percent which exceeded blended client portfolio benchmarks, before investment management costs, by approximately 1.15 percent during the year.
The long-term annualized Pension Fund returns, since Vestcor began its investment management business (originally known as N.B. Investment Management Corporation prior to its privatization in 2016) in 1996, continue to exceed both client return and risk management funding requirements at 7.09 percent.
Located in Fredericton, New Brunswick, Vestcor provides global investment management services to nine different public sector client groups representing approximately $16.9 billion in assets under management, and administration services to 11 public sector pension plans and 4 employee benefit plans.
The Vestcor Group of Companies was created through Province of New Brunswick legislation in July 2016 (the Vestcor Act). As of October 1, 2016, N.B. Investment Management Corporation was continued as VIMC, while the operations of the Pension and Employees Benefits Division of the Province of New Brunswick’s Department of Human Resources were transferred to VPSC. On January 1, 2018 VIMC and VPSC were amalgamated to form Vestcor Inc.
Vestcor’s team of more than 140 New Brunswick-based service professionals provides innovative, integrated, cost-effective investment management and pension and benefit administration services solutions to a number of public sector entities that meet the requirements of approximately 96,000 individual members and 134 employer groups.
John A. Sinclair
President and chief executive officer