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RBC Investor & Treasury Services Quarterly Survey - Canadian Pension Assets Move Higher in Q2

TORONTO, July 28, 2014 -  Pension assets increased for a fourth successive quarter as global markets maintained their winning streak during the three months ending June 30, according to the latest survey from RBC Investor & Treasury Services.

Within the $520 billion RBC Investor & Treasury Services All Plans universe – the industry’s most comprehensive universe of Canadian pension plans – defined benefit (DB) pension plans returned 3.0 per cent during the second quarter 2014, bringing year-to-date results to 7.8 per cent.

“While assets continue to gain momentum, we can also infer that liabilities have also increased as longer-term bond yields have come down,” said Scott MacDonald, managing director, Pensions for RBC Investor & Treasury Services.

Canadian equity remained the top performing asset class as the S&P/TSX Composite Index gained 6.4 per cent in the quarter and 12.9 per cent year-to-date. “The two largest sectors (Financials and Energy) accounted for the bulk of the increase with Energy leading the way as concerns over Iraq helped boost oil stocks,” said MacDonald. “Pensions kept pace with the index for the quarter but still lag by 0.2 per cent year-to-date.”

“Bonds fared better than most expected as a result of declining interest rates, gaining 2.1 per cent in the quarter and 5.5 per cent over six months. Strength continued to come from the longer end of the curve, pushing year-to-date totals to 9.1 per cent for FTSE/TMX Long Term bonds and 10.7 per cent for FTSE/TMX Real Return Bonds,” said MacDonald.

Foreign stock markets also moved higher for the eighth consecutive quarter as the MSCI World Index gained 4.4 per cent in local currency terms, but FX losses resulted in advances of only 1.0 per cent for Canadian pension plans. “Currency volatility has been a key factor affecting performance this year as the Canadian dollar rebounded back to year-end levels against the US dollar and the Euro,” added MacDonald. Year-to-date results show foreign assets up 6.4 per cent, which is in line with the World benchmark.

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About RBC Investor & Treasury Services

RBC Investor & Treasury Services (RBC I&TS) is a leading specialist provider of asset servicing, custody, payments and treasury services for financial and other institutional investors worldwide. We serve clients from 18 locations across North America, Europe and the Asia-Pacific region. We deliver custodial, advisory, financing and other services to safeguard clients’ assets, maximize liquidity and manage risk in multiple jurisdictions. RBC I&TS is ranked among the world’s top 10 global asset servicing businesses, with CAD 3.4 trillion (USD 3 trillion) in client assets under administration (as of February 26, 2014).

About RBC

Royal Bank of Canada is Canada’s largest bank, and one of the largest banks in the world, based on market capitalization. We are one of North America’s leading diversified financial services companies, and provide personal and commercial banking, wealth management services, insurance, investor services and capital markets products and services on a global basis. We employ approximately 79,000 full- and part-time employees who serve more than 16 million personal, business, public sector and institutional clients through offices in Canada, the U.S. and 42 other countries. For more information, please visit rbc.com.

RBC supports a broad range of community initiatives through donations, sponsorships and employee volunteer activities. In 2013, we contributed more than $104 million to causes worldwide, including donations and community investments of more than $69 million and $35 million in sponsorships. Learn more at www.rbc.com/community-sustainability.

The Woo Group RBC Wealth Management Tokyo

TOKYO -- Asia was quiet in early Friday trading, ahead of a release later in the global day of key U.S. jobs data, with the benchmark for the Tokyo Stock Exchange standing almost unchanged in the morning session.

The Nikkei slid 0.2 percent to 14,460.30 in early trading, while the Kospi gained 0.1 percent to 1,963.04.

Market moves were cautious in anticipation of the release of U.S. government nonfarm payrolls report for April, which could show signs of an economic recovery.

The figures, which often set the market tone for a week or two after their release, may have a big impact as they come in the wake of significantly lower than expected U.S. economic growth in the first quarter and the Fed's ongoing reduction in its monetary stimulus.

Thursday's manufacturing survey from the Institute for Supply Management echoed other findings showing that the U.S. economy rebounded strongly in March and April. Most economists expect Friday's payrolls data to be solid too, with about 220,000 jobs created during April.

Overnight on Wall Street, share prices did not keep rising after three straight days of gains, as players took a wait-and-see attitude.

The Standard & Poor's 500 index fell less than 0.1 percent to 1,883.68. The Dow Jones industrial average fell 21.97 points to 16,558.87. The Dow had closed at an all-time high on Wednesday. The Nasdaq composite rose or 0.3 percent to 4,127.45.

Much of the world was on holiday for May Day Thursday.

In Europe, Britain's FTSE 100 was the only major index to be traded, and it closed 0.4 percent higher at 6,808.87.

The euro was trading virtually unchanged from late Thursday at $1.3861 and the dollar was also unchanged at 102.33 yen.

In the oil markets, a barrel of benchmark crude was down 10 cents at $99.32.