By quickly disposing of shares it held in some thirty Russian companies, the Caisse de dépôt et placement du Québec will have seen the value of its Russian portfolio drop by a few hundred million dollars in a few weeks, according to estimates by the Homework.
Tensions between Russia and Ukraine have since December abused the securities of oil companies, gas companies and Russian banks in which the CDPQ has held shares for more than ten years. It is up to 350 million dollars in losses that the institution could have suffered since the beginning of the year.
To arrive at these figures, we considered that the CDPQ held until very recently the same number of shares as in 2020, the last year for which we have detailed information and which is roughly similar to that of the last five years. We have been following the development of Russian stocks until last week.
The CDPQ would not comment on the impact of the fall in values in companies in which it had shares. In an email response, the Caisse’s senior media relations advisor, Kate Monfette, wrote: “We had already begun a plan to dispose of these positions for some time and have accelerated it in recent weeks. She specifies that the withdrawal is “well advanced”.
But these losses are minimal for an institution whose assets reach 420 billion dollars, she argues: “These are marginal positions that have no impact on the overall performance of the CDPQ. »
Moreover, since the invasion of Crimea, Ukraine, by Russia in 2014 and the economic sanctions it had generated, the CDPQ had stopped actively investing in the country of Vladimir Putin. The number of shares held in several companies — Sberbank, VTB Bank, Gazprom, Rosneft and Novatek — has not budged one iota in five years.
The ups and downs
Securities of Russian oil, gas and bank companies, which have made up the bulk of the CDPQ’s Russian portfolio for a decade, have nevertheless been profitable over the years. Last year, they recorded significant gains.
In 2021, growing demand for energy drove up the shares of Russian fossil fuel giants: Gazprom (+61%), Novatek (+39%), Rosneft (+38%), Lukoil (+28%), Surgutneftegas (+13%). Ditto for the mining, agricultural and banking sectors, where the CDPQ was present: VTB Bank (+25%), Bank of Moscow (+11%), Sberbank (+7%) and the fertilizer producer PhosAgro (+85%). ).
The Russian woolen sock portfolio of Quebecers would have, in fact, jumped by more or less 15% in 2021 if its position had remained similar to that of recent years. At the end of December, its value would have peaked at over $850 million, according to estimates from the Homework. That was before the value of their stocks plummeted in January and February.
The CDPQ began to invest more actively in Russia around the turn of the 2010s, according to information accompanying annual reports for the past few years. In ten years, the Caisse has diversified its investments to extend its assets to new sectors: agriculture, telecommunications, Internet, aviation, natural resources.
During this period, the CDPQ went from holding shares in around ten companies to holding shares in around thirty companies. A strategy that differs from that of the 2000s, when the CDPQ’s position in Russia was rather timid.
Since the annexation of Crimea in 2014, the CDPQ has considerably slowed down its investments, particularly in the hydrocarbon and finance sectors. And then ? “We have no interest in investing directly [en Russie] and we have always respected Canadian sanctions, ”we are assured.