TORONTO - The Canada Pension Plan Investment Board's funds under management enjoyed an $11.1-billion rebound in the first quarter, but the company's president and CEO said he still expects markets to remain unstable.
"We're cautious about what markets will do for the balance of our fiscal year, given the very strong runup that we've seen over the past three to four months," David Denison said in a media conference call on Wednesday
"We believe that the patience we've exercised over the last few quarters has paid off in attractive investments... but we also believe that continued patience and discipline will be important in the quarters ahead."
The CPP Investment Board said the value of funds under management rose to $116.6 billion in the April-June period of fiscal 2010 as capital markets clawed themselves further from their recent lows.
That's an increase from $105.5 billion at the end of the prior quarter.
The rise in assets was primarily from a $7.6-billion increase in investment income, and $3.5 billion of contributions that weren't paid out as benefits.
The results were a turnaround from the previous quarterly report, which saw an $8.5-billion drop in the value of the CPP Fund.
Denison said the CPP Fund's executives aren't expecting the strength of the first quarter's results to continue throughout the rest of the year.
"There's a question about how much more of an increase over the coming months we can expect from equity markets," he said.
Though, "we've been very encouraged by what we've seen in credit markets."
Denison also noted that he believes key commercial real estate markets around the world have already hit their bottoms, with the United States being one of the exceptions, where he sees "more softness to come."
On Monday, the CPP Board announced plans to invest up to US$250 million in a joint venture to develop, acquire and manage institutional-quality commercial properties in Brazil.