OMERS reports 2017 investment return of 11.5%

February 23, 2018
Investment businesses produced strong results
  • Investments generated almost $10 billion of net investment income
  • Net assets grew to $95 billion
  • Funded status improved to 94%

Toronto, February 23, 2018 – OMERS, the defined benefit pension plan for Ontario’s municipal employees, achieved a net investment return of 11.5% (after all expenses), compared to a benchmark of 7.3%, and a net return of 10.3% in 2016. The combination of investment return and contributions led to an improvement in OMERS funded status in 2017, bringing it to 94%.

“All of our major asset classes performed well in 2017,” said Michael Latimer, President and Chief Executive Officer. “Our strategy is working. The investment return, combined with contributions from members and employers, improved our funded status. We are committed to meeting the pension promise over the long term.”

“OMERS funded status has improved for the fifth consecutive year,” said Jonathan Simmons, Chief Financial Officer. “Double-digit returns for two years in a row have also allowed us to reduce the discount rate on our pension obligations by a further 20 basis points in 2017.”

OMERS is an important part of Ontario’s retirement system and the broader economy. In 2017, almost 150,000 retired members received a monthly OMERS pension. In total, $4 billion in pension payments flowed back into the economy.

“Feedback from our members, employers and sponsors is important. We are reaching the halfway point in our 2020 Strategy with strong progress on our objectives,” said Mr. Latimer. “I want to thank all of our employees for contributing to a successful year.”

OMERS will publish its 2017 Annual Report in early March.

About OMERS

Founded in 1962, OMERS is one of Canada’s largest defined benefit pension plans, with more than $95 billion in net assets, as at December 31, 2017. It invests and administers pensions for almost half a million members from municipalities, school boards, emergency services and local agencies across Ontario. OMERS has employees in Toronto and other major cities across North America, the U.K., Europe, Asia and Australia – originating and managing a diversified portfolio of investments in public markets, private equity, infrastructure and real estate.

Media Contact:   Ann DeRabbie, aderabbie@omers.com, 416-369-3681
 

Asset Mix and Net Investment Returns

Net Return

for the year ended December 31,

 

2017

 

2016

Public Investments

Fixed Income

Inflation-Linked Bonds

2.0%

3.3%

Government Bonds

0.2%

2.3%

Credit

6.9%

9.0%

Total Fixed Income

4.3%

 

6.5%

Public Equity

14.7%

 

7.1%

Total Public Investments

11.4%

9.4%

Private Investments

Private Equity

11.1%

12.3%

Infrastructure

12.3%

10.9%

Real Estate

11.4%

 

12.3%

Total Private Investments

11.6%

 

11.8%

 

 

 

Total Net Return

11.5%

 

10.3%

 

Asset Mix

­­

as at December 31,

 

2017

 

2016

Fixed Income

Inflation-Linked Bonds

4%

6%

Government Bonds

7%

11%

Credit

18%

17%

Equities

 

 

Public Equity

34%

28%

Private Equity

12%

14%

Real Assets

Infrastructure

16%

17%

Real Estate

14%

15%

Short-Term Instruments

-5%

 

-8%

Total

100%

 

100%

Net Assets

 $ 95.0 billion

 

$ 85.2 billion