By ANDREW WILLIS
Thursday, March 28, 2019
Healthcare of Ontario Pension Plan chief executive Jim Keohane announced Wednesday that he is retiring next year, leaving two of Canada's largest pension funds looking for new leaders after OPTrust launched a search for a new head last week.
Mr. Keohane, 63, will leave the HOOPP in March, 2020, after 20 years with the Toronto-based fund, including an eight-year run as CEO that saw the pension plan double assets under management to $79-billion.
HOOPP provides retirement income for 350,000 provincial health-care workers, including nurses and medical technicians.
The plan posted an annual return of 11.19 per cent over the past decade, beating its performance benchmark in every year since 2008.
"I will retire next year knowing that HOOPP is well positioned for the future and has a great team in place to continue on our 59-year history," Mr. Keohane wrote in a note to colleagues.
HOOPP's board of trustees said Wednesday it has launched a search for a successor. The fund's chairman, Adrian Foster, said in a media release that "Jim is well respected around the world for his pension advocacy, investment strategy and leadership."
While CEO of HOOPP, Mr. Keohane also served as a director of Home Capital Group Inc. He resigned from the mortgage lender's board in April, 2017, after the company ran into financial difficulties and was bailed out with a $2-billion line of credit from HOOPP, which carried a 10-percent annual interest rate. The loan was subsequently replaced with a less expensive debt-andequity package from Berkshire Hathaway Inc.
Last week, the $20-billion OPTrust pension plan announced in a three-paragraph news release that after four years at the helm, CEO Hugh O'Reilly had resigned "effective immediately to pursue other interests."
The Toronto-based fund manages the retirement savings of 92,000 Ontario government workers. OPTrust named chief financial officer Doug Michael as interim CEO and said its board had begun looking for a permanent replacement. The next CEO at OPTrust will be the fourth boss in seven years.
HOOPP and OPTrust will have a deep candidate pool to choose from for their next CEO, as Canada's public-service pension plans typically offer executive compensation that is competitive with private-sector wealth managers, such as mutual funds. The pension plans justify these pay packages as the only way to attract talented investment professionals to public-sector plans.
While the two Ontario pension plans don't disclose what they pay individual employees, larger plans such as the Ontario Teachers Pension Plan, OMERS and the CPP Investment Board paid their CEOs between $4-million and $5million last year, and most of the senior executives at the funds took home $3-million or more.
In contrast, many U.S. and European public-sector plans pay their executives civil-servant wages, in the $100,000 to $200,000 range, and often outsource management of their investments.