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Sovereign Wealth Funds Briefing 29.May 2015

Posted on 29 May 2015 by VRS |  Email |Print

Chinese stocks fell the most in four months on Thursday, as a selloff swept the financial sector after a unit of China’s sovereign-wealth fund reportedly cut its stakes in state-owned banks for the first time. The Shanghai Composite Index sank 6.5% to 4,620.27, pulling back from a seven-year closing high after a seven-day bull run.
That also marked its steepest daily percentage decline since Jan. 19, when the index dived 7.7% after China tightened up margin-trading rules. Hong Kong’s Hang Seng Index HSI, -0.20% also declined 2.2%, falling the most in more than five months. The mainland-China-tracking Hang Seng China Enterprises was down 3.5%………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

The Shanghai stock market dived 6.5% yesterday after the Hong Kong Stock Exchange disclosed that China’s domestic sovereign wealth fund Huijin had sold some of its bank holdings. Why is this news clip such a big deal? Huijin is the major shareholders of the Big Four banks and this is its FIRST divestment.
Since 2008, Huijin has bought altogether 855 million shares of ICBC (1398.Hong Kong) and 561 million shares of China Construction Bank (939.Hong Kong in five rounds. “Its actions were largely seen as a symbolic support to both the market and the banking sector,” wrote Deutsche Bank analyst Tracy Yu and team this morning………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

Fullerton India Credit Co. Ltd, the non-banking financial company owned by Singapore’s state-run investment firm Temasek Holdings Pte Ltd, will set up a new home finance company to lend to people in the so-called affordable housing segment, buoyed by its recent success in retail lending in India.
“So far, we have kept away from housing finance because competition was tough and we could not compete with the banks on pricing. But now, with the network we have built, we think we can compete on pricing and also take advantage of the high returns this sector offers,” Shantanu Mitra, managing director and chief executive said on Thursday………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

AGL Energy and coal miner New Hope Corp could be the biggest casualties of a proposed directive by Norway’s parliament for the nation’s $US900 ($1.16 trillion) sovereign wealth fund to sell out of coal stocks. The plan would build on earlier steps by Norway’s Government Pension Fund Global (GPFG) to reduce its coal exposure and adds momentum to a global push for divestment from coal.
The GPFG is built on Norway’s oil wealth and the latest measure would capture power companies that depend on coal for more than 30 per cent of generation as well as miners that get 30 per cent of their revenues from thermal coal. The GPFG sold out of Whitehaven Coal last year. ……………………………..Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

Other investors are likely to follow Norwegian fund’s move out of coal-based investments, due to its size as the world’s largest sovereign wealth fund. Norway’s decision to dump all coal-focused investments from its $900bn sovereign wealth fund could unleash a wave of divestment from other large funds, according to investment experts. The fund, the largest in the world, is one of the top 10 investors in the global coal industry.
The move, agreed late on Wednesday, is one of the most significant victories to date for a fast-growing and UN-backed fossil-fuel divestment campaign. It will affect $9bn-$10bn (£5.8-£6.5bn) of coal-related investments, according to the Norwegian government………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

World’s richest sovereign wealth fund increased its investments in coal despite high-profile pledge to dump fossil fuels, financial analysis shows. The world’s richest sovereign wealth fund has sunk more money into coal just three months after a high-profile pledge to dump fossil fuels as part of its commitment to responsible investing, according to financial analysis by three environmental groups.
Instead of reducing its overall exposure to businesses based on coal, the Norwegian Government Pension Fund (GPF) increased its holdings by 3bn Norwegian kroner to NOK 85.8bn ($11bn/£7.3bn) by the end of last year, the report Still Dirty, Still Dangerous said………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

The Government Pension Fund Global, Oslo, could be forced to divest its allocations to certain coal companies, following a unanimous decision by the finance committee of the Storting, the Norwegian parliament.
The divestment would apply to companies that derive 30% or more of their business from coal. The finance committee’s proposition will be voted on in parliament June 5, said a spokeswoman for Norges Bank Investment Management, the investment manager of the 7 trillion Norwegian kroner ($957 billion) sovereign wealth fund………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

Norway’s $900 billion sovereign wealth fund may soon have to drop its investments in the coal industry, thanks to a new set of rules making their way through the country’s parliament. Starting next year, the fund would be forced to pull its money from companies such as mining firms or utilities that make at least 30 percent of their revenue from coal, according to the Associated Press.
The law received bipartisan support in committee and is widely expected to pass during a final vote early next month. This is a notable victory for climate change activists who have been lobbying institutional investors to divest from fossil fuels. A number of university endowments and foundations have already joined the cause, but Norway’s sovereign wealth fund is the globe’s largest, laying claim to roughly 1 percent of all the world’s stocks and bonds. Environmentalists just landed a very, very big ally in their crusade………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

“Today’s alpha is tomorrow’s smart beta,” Jay Willoughby, CIO of Alaska Permanent Fund Corp., told the sovereign wealth fund’s board of trustees in a pitch last December. During his Anchorage address, Willoughby called for $54.6 billion APFC to be an anchor investor in a new family of smart beta exchange-traded funds that it would design with a yet-to-be-determined partner. The proposed $1 billion allocation would join the fund’s four other smart beta and quasi-passive mandates, which already total nearly $5 billion.
No one in the investment community can ignore smart beta - index strategies that diverge from traditional market capitalization weighting techniques to capture well-documented risk factors such as value, momentum and low volatility. In the past decade smart beta ETFs have grown by more than $400 billion in the U.S. alone, according to Chicago-based Morningstar, which prefers the term strategic beta………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

Edo State Governor, Comrade Adams Oshiomhole, yesterday came for the Coordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, requesting her to account for an estimated $30 billion which should have accrued to the government based on the official oil exports of 2.3 million barrels per day.
Wondering why the management of public finance was shrouded in secrecy under her tenure, Oshiomhole called on the Finance Minister to tell Nigerians before leaving office how the economy was managed since her coming on board in 2011………………………………Full Article: Source

Posted on 29 May 2015 by VRS |  Email |Print

Singapore’s sovereign-wealth fund GIC Pte. Ltd. has agreed to buy an undisclosed stake in Brazilian hospital operator Rede D’Or São Luiz, investment bank BTG Pactual SA said on Thursday. BTG said GIC will pay 1.6 billion Brazilian reais ($508 million) for its shares in Rede D’Or.
According to Valor Economico newspaper, GIC agreed to acquire a total stake of 15.3% in Rede D’Or for 3.2 billion Brazilian reais, with the company’s founding Moll family and BTG selling equal stakes. A BTG spokesman declined to provide further details on Thursday. GIC and Rede D’Or representatives weren’t immediately available for comment………………………………Full Article: Source

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