2008 Annual Report - IWA Forest Industry Pension Plan

ASSETS IN THE PENSION FUNDThe Pension Fund has grown from $58 million in 1977 to $2.51 billion at the end of 2008. During 2008, all investors – both institutionaland individuals – witnessed unusual stock, bond and real estate market volatility.The Pension Fund is balanced and broadly diversified. 2008 was one of the best examples of the value of diversification. It’s thisbalance – diversification across asset classes, regions, sectors and currencies - that is the key to weathering the storms. The PensionFund has experienced market downturns in the past and recovered well. In fact, 2008 was only the fourth time in the last thirtyyears where the Pension Fund saw negative returns. It is important to keep in mind that long-term performance is most significantfor pension plans because they pay benefits to members over very long periods of time. Be assured that the Plan’s investmentpolicies are sound and the Plan’s investment managers continue to work diligently to ensure long-term value is added to the Plan’sportfolio.MARKET VALUE ASSET GROWTH (20 YEARS)3.53.03.1803.213Asset Value ($Billions)2.52.01.51.00.50.00.59619880.69519890.68219900.78519910.80619920.98919931.03919941.26319951.51119961.69819971.81419981.95319992.11020002.07920011.95020022.21620032.45120042.8002005200620072.5132008Plan contributions by members and employers add to assets, as do positive rates of return on investments. However, as the Planbecomes mature, contributions are expected to make up less of total cash inflows while investment returns will make up relativelymore. The next graph illustrates a downward trend of the ratio of contributions to pension payments. Although benefit paymentshave steadily risen over the past 20 years, the contribution levels have remained relatively stable and the health of the Pension Fundhas therefore become more reliant on investment returns.RATIO OF CONTRIBUTIONS TO PENSION PAYMENTS (20 YEARS)1.61.41.21.00.80.60.40.20198819891990199119921993199419951996199719981999200020012002200320042005200620072008IWA - Forest Industry Pension PlanAnnual Report 200810