The manager of Quebec's public pension fund will raise up to $8B in debt. (Canadian Press)

Quebec pension giant Caisse de dépôt et placement said Friday it will issue up to $8 billion in bonds in Canada, the U.S. and Europe by the end of 2010, with the amount depending on market conditions.

The debt issue will replace short-term credit instruments with longer-term debt to increase the stability of the financing of the public and private pension plans the Caisse manages.

The refinancing is the latest move to bolster the financially beleaguered Caisse, which manages one of the largest capital pools in Canada — $120.1 billion as of the end of 2008.

In August, it announced it would revamp its real estate arm and abandon riskier commercial loans after $5.7 billion in losses wiped out other gains during the first half of 2009.

Caisse managers said $4 billion of these unrealized losses were in real estate, and they booked $1.7 billion in declines of other illiquid investments — $1.3 billion in private equity and infrastructure, and $400 million on asset-backed commercial paper.