Canadian defined benefit (DB) pension plans saw growth in the third quarter, buoyed by equity markets, fixed-income assets, even as Canada’s economy showed signs of strain, according to data from both Northern Trust Corp. and RBC Investor Services.
Northern Trust reported the median Canadian defined benefit pension plan in its universe, which tracks the performance of DB plans that subscribe to its services, returned 3.6% for the quarter and 4.3% year-to-date.
Northern Trust said that equity markets remained strong in the third quarter despite macroeconomic uncertainty, particularly among U.S. companies. Bond markets experienced intermittent volatility driven by fiscal concerns and persistent inflation but still rose for the period. Meanwhile, gold prices reached record highs, supported by central bank demand and investor demand for safe-haven assets.
Canadian manufacturing data for the quarter signalled continued contraction amid trade pressures and weak export demand, Northern Trust said.
RBC reported that Canadian DB pension plans under its administration grew 4.4% in the third quarter, marking the largest median quarterly return of the year.
The year-to-date increase for the period ending Sept. 30 was 7.1%.
“The third quarter of 2025 was unusual in that both equities and fixed income advanced at the same time,” Isabelle Tremblay, director of client solutions and asset owner segment lead at RBC Investor Services, said in a release. “We can attribute the equity returns to resilient corporate earnings, AI-driven productivity and strong deal-making.”
RBC-client pension plans invested in Canadian equities had a 9.5% return for the quarter and 21.5% year-to-date. By comparison, the S&P/TSX Composite Index increased by 12.5% for the quarter and 23.9% thus far this year.
The materials sector drove gains in the equities market, increasing 37.8% in the third quarter and 79.3% year-to-date. Other leading sectors posting significant gains included information technology (13.2%), energy (12.6%) and financials (10.6%), the bank said.
On the other hand, RBC fixed-income allocations returned 1.5% for the quarter and 2.1% year-to-date. The FTSE Canada Overall Bond Index rose by 1.5% for the quarter and 3% so far this year, with medium-term bonds generating the strongest returns.
“Fixed-income assets performed well across the yield curve, supporting overall portfolio performance,” RBC said.