Item - 2020.EX19.8

The Executive Committee recommends that:

1.  City Council receive the report (November 25, 2020) from the Chief Financial Officer and Treasurer for information.

The purpose of this report is to provide the following information:

1.  Performance of the Funds for the first six months of 2020

2.  General Market Update and Benchmark Performance

The City's General Group of Funds ("General Fund") that holds the City's working capital and the amounts designated for the City's reserves and reserve funds earned:

• $92.4 million in the first six months of 2020 (3.6% annualized rate of return)

The City's Sinking Fund portfolio that holds funds for future debt repayments earned:

• $17.2 million in the first six months of 2020 (2.3% annualized rate of return) 

Since January 1, 2018, the City's long-term investments have been managed by the Toronto Investment Board under a new Council adopted Investment Policy which is based on the prudent investor standard.

As at June 30, 2020, approximately 80 percent of both the Sinking Fund and the Long Term Fund were managed by external investment managers selected by the Toronto Investment Board.  At the end of 2019, four external fixed income managers controlled approximately 70 percent of the assets while two global equity pooled fund managers oversaw 7 percent of these funds.  A third global equity pooled fund manager started in February 2020 resulting in a total equity exposure of 10 percent at the fund level by June 30, 2020. The balance of these funds remain in cash and short-term securities until additional external fund managers can be funded.  Selection and contract negotiations for an additional global equity pooled fund manager and real asset managers continues in 2020.

All funds managed are compliant with the Council-approved Investment Policy.