Canadian Pension Funds Count the Cost of Private Equity Slump

Canada’s largest pension funds are grappling with losses in their private equity portfolios, signaling a challenging period for alternative investments. Recent reports indicate a significant downturn, impacting even traditionally strong performers like the Ontario Teachers’ Pension Plan.

Ontario Teachers’ Pension Plan Reports First Private Equity Loss in Over a Decade

The Ontario Teachers’ Pension Plan (OTPP), one of Canada’s top eight pension funds – often referred to as part of the “Maple 8” – recently announced its first loss in private equity since 2009. Bloomberg reported on March 10, 2026, that OTPP is actively reassessing its private equity investment strategy in response to these losses.

Despite the private equity setback, OTPP reported positive overall results for 2025, with net assets reaching C$279.4 billion as of December 31, 2025. According to OTPP’s website, the fund is focused on delivering retirement security to teachers of Ontario through strategic investments across key markets, and sectors.

Broader Trends in Canadian Pension Fund Performance

The struggles of OTPP reflect a wider trend among Canadian pension funds. The Financial Times reported on March 16, 2026, that both OTPP (managing C$279 billion) and the Ontario Municipal Employees Retirement System (OMERS, with C$145 billion in assets) have reported challenges in their private equity holdings.

These difficulties stem from a broader slump in the private equity market, influenced by factors such as higher interest rates and economic uncertainty. Pension funds, traditionally significant investors in private equity, are now facing increased scrutiny over the returns generated by these investments.

OTPP’s Strategic Response and Future Outlook

OTPP is responding to the private equity downturn by overhauling its investment approach. The fund is seeking to refine its selection criteria and focus on higher-quality private equity opportunities. This shift aligns with a broader industry trend towards more cautious and selective investing.

As of December 31, 2024, OTPP had over $266 billion in net assets, with a one-year total-fund net return of 9.4% and a 10-year total-fund net return of 7.4%. According to Wikipedia, OTPP employs a Quality Service Index to measure its performance and reported 93% member satisfaction in 2024.

The fund continues to pursue investments in areas like critical minerals, as demonstrated by its recent acquisition of a portfolio of royalties in Western Australia. OTPP’s website also highlights investments in innovative companies like the UK self-driving firm Wayve, which secured $1.5 billion in funding.

Key Takeaways

• Canadian pension funds are experiencing losses in their private equity portfolios.
• Ontario Teachers’ Pension Plan reported its first private equity loss since 2009.
• OTPP is adjusting its private equity investment strategy to address the challenges.
• The downturn reflects broader trends in the private equity market.
• Despite challenges, OTPP remains a significant global investor with substantial assets under management.