Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).

Connor Clark & Lunn (“CC&L”) is the manager of the CC&L Group Bond, CC&L Group Balanced Plus and CC&L Group Income & Growth funds. Earlier this year, they announced the amendment of the Statement of Investment Policies and Procedures of these funds.

For the CC&L Group Bond and CC&L Group Balanced Plus funds, the included note allows them to invest in an “investment grade default swap index” within the fixed income component. The note is as follows:

“The Fund may at times have exposure to an investment grade credit default swap index, which consists of issuers with at least a BBB- rating, at the time of series initiation. From time to time, issuers may be downgraded, which may result in the Fund having exposures to issuers rated less than BBB-. The maximum exposure to credit default swap indices is 10% of the Fund.”

For the CC&L Group Income & Growth fund, the included note allows exposure to a “high yield index or a credit default swap”.  The note is as follows:

“A portion of the Fund may at times have exposure to a high yield index or a credit default swap. The indices will likely have some exposure to issuers with credit ratings lower than B-. The maximum exposure to high yield and credit default swap indices is 10% of the Fund.”

Sun Life GRS Investment Solutions is comfortable with this change but will be monitoring the holdings in these funds in upcoming quarters.

How does this affect plan sponsors and plan members?

Plan sponsors or plan members don't have to take any action, as a result of these changes.

Questions?

Please contact your Sun Life Financial Group Retirement Services representative.

Copies of the revised SIP&Ps are available on Sun Life’s Plan Sponsor Services website at sunlife.ca/sponsor.  When logged into the website, under the Administration and reporting tab, select Group Retirement Services, then on the top navigation menu select Investments>> Governance reports.