The Canada Pension Plan Investment Board posted a 12.2 per cent return on its investments in its last fiscal year.
However, despite the Trump-fueled volatility stateside, the board’s CEO told BNN on Thursday that he is comfortable staying the course and staying disciplined in its acquisition approach.
Here’s what Mark Machin had to say about NAFTA, Home Capital Group, Canada’s new infrastructure bank and more.
MACHIN ON HOME CAPITAL AS ‘THE CANARY IN THE COAL MINE’
“From everything I’ve seen, I think that that’s overblown that it’s anything other than an isolated situation.”
ON CANADA’S INFRASTRUCTURE BANK
“[It’s] a really good idea to manage this complexity where you have this Federal system. The federal government has to work with the provinces, has to work with municipalities in order to create opportunities that are interesting for institutional capital like us.”
“That’s really complicated to do so you need a pool of expertise, a pool of people who can actually understand that, do the groundwork, prepare the opportunities and maybe provide some financing around it as well.”
ON RENEGOTIATING NAFTA
“There’s obviously risks around that, but I think there’s a good understanding from what I’ve seen on both sides – Canada and the U.S. – that it’s a really important trading relationship and I think [it is] mutually beneficial across multiple states and multiple provinces. So, I think there‘s a lot of people on both sides in business who understand it’s a very rich relationship and one that needs to continue.”
ON BEING OUTBID ON INFRASTRUCTURE DEALS
“We’ve been price-disciplined. We’re there, we see the opportunities, we compete for them. Sometimes in the early stages it appears that the competition is going to pay way more than we think the long-term value is in the opportunity, so we will just back off rather than spending a lot of money to pursue the opportunity.”
ON BEN BERNANKE’S ‘PUZZLED’ OPINION ON POLITICAL RISK
“Markets have been pretty blasé about a lot of things: I think it’s about any type of risk, economic risk, financial risk… I think a lot of things are being priced very fully – both public assets and private assets – so it’s not surprising and it’s not really troubling for a long-term investor like us to see a little bit of a rise in people’s expectations of risk. I think that’s a healthy thing.”