Fri, Apr 25, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hong Kong’s foreign reserve reaches $258.8bn in March, to diversify into hedge funds, PE

Wednesday, April 14, 2010
Opalesque Industry Update – Hong Kong’s foreign dollar reserves rose to $258.8bn in March, up by $600m compared to the February figure. The reserves have given the Hong Kong Monetary Authority (the special administrative region’s de facto central bank) more flexibility to invest in riskier portfolios.

In a statement, HKMA said total foreign currency reserve assets represent over nine times the currency in circulation or about 56% of Hong Kong dollar M3. Hong Kong is the world’s seventh largest holder of foreign currency reserves based on the latest published figures, after Mainland China, Japan, Russia, Taiwan, India and Korea.

A report by FT.com showed that at least three private equity firms, including Kohlberg Kravis Roberts (KKR), Bain and Blackstone received investments from or held talks with HKMA. The bank is even considering investing in the mainland.

According to TheStandard.com, HKMA’s foray into alternative investments is a major shift of policy since Norman Chan Tak- lam took over the helm of the bank. His predecessor, Joseph Yam Chi-kwong, did not even considered alternative investments during his term.

Benzinga.com described HKMA’s exposures as conservative and the bank has traditionally invested its reserves in safe liquid investments. TheStandard.com quoted an HKMA spokesperson as saying: "The authority has an ongoing review of Exchange Fund investment principles. But as it is market sensitive we would not comment on its daily operations."

Last year, the Exchange Fund posted a total HK$106.7bn ($13.75bn) investment income, or a 5.9% investment return amid strong rebound in global equities.

Hong Kong’s economy has also shown positive grown in the first two months of 2010 after overall export value rose 23% year-on-year, according to Chinaknowledge.com. Export value of domestic goods jumped 21% on the back of stabilizing global economy. The city is expected to continue to experience double-digit growth in its export sector in the first half of this year. – Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Banner
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Rainwater and Blue Sky - an Australian water fund emerges[more]

    Bailey McCann, Opalesque New York: Financial reporters often tout new funds and investments as uncorrelated investments, but few can say they are uncorrelated to everything but weather. Enter Blue Sky Alternative's water fund which invests in the permanent rights to Australia's water. Sev

  2. Regulatory – Expect greater SEC scrutiny of hedge funds that share information or collaborate in advance of their trades, Alternative funds to get SEC test for leverage, liquidity[more]

    Expect greater SEC scrutiny of hedge funds that share information or collaborate in advance of their trades From Thelawyer.com: A recent Wall Street Journal article — ‘Activist investors often leak their plans to a favoured few’ — focused attention on ‘activist’ investors and stock analy

  3. …And Finally – This week's least competent criminal is Austrian[more]

    From ABCnews.go.com: A German sought by authorities for alleged fraud has been arrested in Austria — after dropping into a police station to ask officers whether he was under investigation. Police in Salzburg said the 59-year-old man walked into a police station in the city on Friday night. Sp

  4. Investing – Hedge funds find pitfalls along with profits in real estate ventures, Marcato Capital Management makes new bet on Dillard’s[more]

    Hedge funds find pitfalls along with profits in real estate ventures From Law360.com: Hedge funds have joined the rush to real estate deals and development in recent months to close the financing gap left by tightening bank standards, but attorneys say many aren't prepared for the disclo

  5. Agecroft Partners estimates 90% of hedge funds using social media[more]

    The use of social media has increased significantly within the hedge fund industry over the past couple of years. Social media is broadly used by investors as part of their due diligence process on hedge funds, by service providers in their sales efforts to hedge funds, and by hedge funds to enhance