Wed, Apr 16, 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. CTAs could face new challenges in a rising rates environment[more]

    Bailey McCann, Opalesque New York: CTAs have taken a beating performance wise lately, and asset flows reports show that investors aren't sticking around to see how the movie ends. Now, a new white paper from Roy Niederhoffer and Coen Weddepohl notes that as interest rates start to tick back u

  2. Investing – Big hedge funds bought Puerto Rico's junk bonds, Fidelity explores new trading venue amid flash trade concerns, Crisis-era Greek bonds reward early buyers with big effective returns, Cargill unit discloses stake in Freddie preferred[more]

    Big hedge funds bought Puerto Rico's junk bonds From Reuters.com: Several large hedge funds doubled down on Puerto Rico in last month's giant bond sale despite the U.S. territory's financial struggles, the Wall Street Journal reported, citing confidential documents reviewed by the newspa

  3. Commodities – Popular value fund manager David Iben bets on Russia, gold,[more]

    From Reuters.com: With large bets on Russia and North American gold miners, one of the best performing stock pickers in the wake of the 2008 financial crisis is back with a new fund that reflects his deep aversion to following the crowd. In the Kopernik Global All-Cap Fund, David Iben is follo

  4. Opalesque Exclusive: Pensions, endowments, family offices reconsider life settlement investments[more]

    Bailey McCann, Opalesque New York: Hedge funds were once the largest investors in the life settlement industry, now the industry is seeing more interest from pensions, endowments and family offices directly. Life settlements have always been considered a niche part of the investing landscape, an

  5. SEC allows investment funds to use social media[more]

    Bailey McCann, Opalesque New York: The Securities and Exchange Commission (SEC) has released new guidance letting investment funds and advisors use social media to promote client reviews. The guidance seeks to assist investment managers in developing compliance policies and procedures reasonably