1999 Q3 - Notice to Stakeholders

The Board of Directors of the Canada Pension Plan Investment Board (the "Investment Board") today released the financial statements for its first operating quarter ending December 31, 1998.

During this quarter, the Board of Directors undertook activities to set up the new organization and prepare for the investment of CPP contributions that are scheduled to begin in the quarter ending March 31, 1999. The Board of Directors is actively engaged in the search for a Chief Executive Officer.

The mandate of the Investment Board is to invest CPP contributions in the best interests of plan contributors and beneficiaries. To this end, the Board of Directors has established an investment policy that calls for the investment of all funds received by the Investment Board in equities, of which twenty per cent will be invested in foreign equities. This policy recognizes that the approximately $36.5 billion in assets currently in the Canada Pension Plan account, but not under the Investment Board's management, are composed primarily of government debt obligations.

The domestic equity investments will substantially replicate a broad market index, as required by the Investment Board legislation. The TSE300 has been selected as the index. Equity investments outside of Canada will be made through replication of the Morgan Stanley Capital International (MSCI) Global Index, exclusive of Canada, which includes U.S., Europe, Australia and Far East equities. The Board of Directors has indicated that this investment policy will be reviewed following the appointment of a Chief Executive Officer.

Investment advice has been provided to the Investment Board by William M. Mercer Limited.

The Board of Directors has appointed TD Quantitative Capital as the investment manager for the domestic equity portfolio and Barclays Global Investors as the manager for the foreign equity portfolio. Royal Trust has been appointed as the custodian for the Investment Board. The firm of Deloitte & Touche LLP has been appointed as the Investment Board auditors. These appointments are effective immediately.

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