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Sovereign Wealth Funds Briefing - Category | Performance more

Australia’s Future Fund delivers 8.4 pct, lowest return since 2011

Posted on 27 January 2016 by VRS  |  Email |Print

Australia’s sovereign wealth manager, the Future Fund, on Wednesday said it returned 8.4 percent in the year ending Dec. 31, its lowest annual return since 2011 as it boosts cash holdings amid greater global markets volatility.
Global markets have been unusually volatile since last August, largely led by fears of slowing growth in China and uncertainty over the timing of U.S. interest rate hikes. Future Fund Managing Director David Neal said the fund has “gradually reduced the level of risk” in the portfolio through 2015………………………………………..Full Article: Source

Sovereign Wealth Funds Are Driving Asset Slump, Jefferies Says

Posted on 20 January 2016 by VRS  |  Email |Print

Sovereign wealth funds from energy-producing countries are exacerbating a global market rout by selling off assets to meet their financial commitments amid slumping oil prices, according to Jefferies LLC.
The sales mark a new phase for the countries, after they tried boosting oil production and printing currency to make their payments, David Zervos, chief market strategist at New York-based Jefferies, wrote Monday in a note to clients………………………………………..Full Article: Source

Future Fund awarded sovereign investor of 2015

Posted on 20 January 2016 by VRS  |  Email |Print

Australia’s $118 billion sovereign wealth fund has been recognised for its restrained decision not to increase risk to chase returns in 2015, collecting sovereign investor of the year at the 2016 Central Banking Awards.
Managing director of the Future Fund, David Neal, said fund had to make certain it was not brought in to financial crisis aftershocks. “While the global economy has continued to heal following the 2008-09 financial crisis, significant imbalances persist and the potential for missteps and shocks remains,” Neal said………………………………………..Full Article: Source

The Trouble With Sovereign-Wealth Funds

Posted on 20 January 2016 by VRS  |  Email |Print

Russian President Vladimir Putin, center, spoke with the emir of Kuwait, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, in November in Russia at the time the Russian Direct Investment Fund signed an agreement with Kuwait’s sovereign-wealth fund, the Kuwait Investment Authority, to expand their partnership.
Kazakhstan’s $55 billion sovereign-wealth fund helped pull the country through the global financial crisis and offered funding for the country’s bid to host the 2022 Winter Olympics. But the collapse in oil prices has hit Kazakhstan and its fund, Samruk-Kazyna JSC, hard. In October, the fund borrowed $1.5 billion in its first syndicated loan to help a cash-strapped subsidiary saddled with a troubled oil-field investment………………………………………..Full Article: Source

Malaysia accounts for 55.1% of Khazanah’s realisable asset value

Posted on 14 January 2016 by VRS  |  Email |Print

Malaysia accounted for about 55.1% of Khazanah Nasional Bhd’s realisable asset value (RAV) by geographic exposure in 2015. The sovereign wealth fund said on Wednesday that overseas investments accounted for the remainder of RAV.
The RAV reflected Khazanah’s internationalisation strategy in 2015, which saw the setting up of a London office by its unit subsidiary Khazanah Europe Investment Ltd. The London office is Khazanah’s fifth regional office after Beijing, Mumbai, San Francisco and Istanbul………………………………………..Full Article: Source

Sovereign Wealth Funds Spent Less in 2015

Posted on 12 January 2016 by VRS  |  Email |Print

The total direct transaction amount in 2015 by sovereign funds is US$ 114 billion compared to US$ 122 billion in 2014. However, when calculating all public investors, which includes large public pensions, direct transactions total US$ 211 billion in 2015 versus US$ 186 billion in 2014.
Leading the charge for asset-rich pensions were Canadian institutional investors such as Canada Pension Plan Investment Board (CPPIB), Ontario Teachers’ Pension Plan (OTPP) and Caisse de dépôt et placement du Québec (CDPQ)………………………………………..Full Article: Source

Sovereign wealth fund deals fall 13 pct in fourth quarter

Posted on 11 January 2016 by VRS  |  Email |Print

Sovereign wealth funds made $23.5 billion worth of overseas acquisitions in the fourth quarter of 2015, down 13 percent from the third quarter, although big infrastructure and property deals remained popular.
Thomson Reuters data showed that sovereign wealth funds (SWFs), which invest windfall revenues from oil and other commodities for future generations, were involved in 25 deals during the October-December period, down six from the previous quarter. Over the full year, SWFs invested in 127 transactions, down from 148 in 2014. The total value of 2015’s deals amounted to $68.7 billion, down 6.9 percent from $73.8 billion in 2014………………………………………..Full Article: Source

Top 10 Sovereign Wealth Fund Game-Changers of 2015

Posted on 05 January 2016 by VRS  |  Email |Print

For sovereign funds regarding the falling price of oil, it is worth recalling Friedrich Nietzsche’s aphorism: “That which does not kill us makes us stronger.” Sovereign funds in the Gulf have increased exercising discipline from the sizable allocations of 2009 and 2010. SWFI research staff have composed the top ten game-changers for sovereign wealth funds in 2015.
10.) Smart Beta Lives: Many active investment managers despise the term “smart beta.” According to Investopedia.com, smart beta was the most searched for term in its dictionary in 2015. Google searches for smart beta continue to grow. Wealth funds continue to tinker with smart beta strategies. Some sovereign funds and pensions even partner with providers to back new product launches………………………………………..Full Article: Source

SOFAZ reveals volume of revenues for entire period of its activity

Posted on 04 January 2016 by VRS  |  Email |Print

The revenues of the State Oil Fund of Azerbaijan (SOFAZ) for the entire period of its activity totaled $124.9 billion, SOFAZ told Trend Dec.29. The State Oil Fund was created in 1999 and its assets were equal to $271 million that time. The total expenditures of SOFAZ for the entire period of its activity amounted to $86.3 billion, including transfers to the state budget - $78.4 billion.
“At the same time, for the whole period the extra-budgetary expenditures of the fund due to the difference in the exchange rate of the currencies in the investment portfolio of SOFAZ, amounted to about $5 billion,” said the fund………………………………………..Full Article: Source

‘Politicised’ SWFs earn lower returns

Posted on 30 December 2015 by VRS  |  Email |Print

Sovereign wealth funds that are “highly politicised” earn lower returns on their stock-market investments than more independent peers, according to new academic research. An analysis of more than 1,000 sovereign wealth fund investments in publicly traded companies found that shares in those companies rose less following a purchase by a sovereign wealth fund compared with almost 6,000 comparable stock purchases by private investors.
The so-called SWF discount was worse when funds with strict government oversight bought shares. There was no discount when Norway’s independently managed sovereign wealth fund bought shares, according to Veljko Fotak of the University at Buffalo, who wrote the report with Bernardo Bortolotti of Turin University in Italy and William Megginson of the University of Oklahoma………………………………………..Full Article: Source

‘Politicized’ Sovereign Funds Earn Lower Returns, Study Says

Posted on 28 December 2015 by VRS  |  Email |Print

Sovereign-wealth funds that are “highly politicized” earn lower returns on their stock-market investments than more independent peers, according to new academic research. An analysis of more than 1,000 sovereign-wealth fund investments in publicly traded companies found that shares in those companies rose less following a purchase by a sovereign-wealth fund compared with almost 6,000 comparable stock purchases by private investors.
The so-called SWF discount was worse when funds with strict government oversight bought shares. There was no discount when Norway’s independently managed sovereign-wealth fund bought shares, according to Veljko Fotak of the University at Buffalo……………………………………….Full Article: Source

HKMA long-term growth portfolio yields 13.5% as of end-2014

Posted on 16 December 2015 by VRS  |  Email |Print

Hong Kong Monetary Authority‘s Long-term Growth Portfolio (LTGP) has yielded an internal return ratio of 13.5 percent as of the end of last year since its inception about seven years ago, a senior official said. Eddie Yue, deputy chief executive of HKMA, said in an article published on the monetary authority’s website that the LTGP’s investment mandates are in line with the goals set forth for the government’s Future Fund.
The government had earlier decided to establish a long-term Future Fund with half of the Land Fund to be entrusted in the LTGP. The portion will be worth about HK$100 billion as part of the larger Land Fund that amounts to over HK$200 billion………………………………………..Full Article: Source

Sovereign Wealth Funds Grow Assets in 2015

Posted on 14 December 2015 by VRS  |  Email |Print

In line with the release of the 2015 Preqin Sovereign Wealth Fund Review in April 2015, we found that AUM for sovereign wealth funds globally reached $6.31tn as at March 2015 – increasing by more than $900bn in 18 months. This is despite falling commodity and oil prices, which many of these institutions rely on for funding. Assets therefore grew from continued funding from reserves and governments, as well as from investment returns.
Alternative assets are an increasingly important part of these institutions’ portfolios, particularly as they seek to diversify their portfolios and acquire assets that can generate yield and help meet their long-term objectives. As at December 2015, total assets for sovereign wealth funds that are looking to invest in private equity stands at $6.0tn………………………………………..Full Article: Source

Saudi Arabia, UAE sovereign funds rank among world’s largest: SWFI

Posted on 11 December 2015 by VRS  |  Email |Print

Saudi Arabia and the United Arab Emirates’ sovereign wealth funds— at $668.6 billion and $773 billion, respectively— ranked as the Middle East’s largest in December 2015, according to a report issued by the Sovereign Wealth Fund Institute (SWFI).
The asset value of the kingdom’s SWF dropped by about $3.2 billion q-o-q since the institute’s last quarterly report. It ranked as the world’s fourth largest, just behind China. Meanwhile, the Abu Dhabi Investment Authority (ADIA) ranked second on the list after Norway. The Kuwait Investment Authority (KIA) claimed the fifth spot with assets worth $592 billion, while the Qatar Investment Authority (QIA) placed ninth at $256 billion………………………………………..Full Article: Source

Bypassing investment banks in bond sales helps GIC boost returns

Posted on 10 December 2015 by VRS  |  Email |Print

Acting as a cornerstone investor in bond deals is helping GIC boost returns on its fixed-income portfolio as yields persist near record lows and risks start to increase in the bond market, according to Singapore’s sovereign-wealth fund.
Companies that issue bonds directly to GIC when it acts as an anchor investor save on underwriting fees and part of those savings are passed on to the wealth fund, Chief Investment Officer Lim Chow Kiat said in an interview with the London-based Sovereign Wealth Center published Tuesday………………………………………..Full Article: Source

FSDEA ranks high on Sovereign Wealth Fund Institute Transparency Index

Posted on 10 December 2015 by VRS  |  Email |Print

Fundo Soberano de Angola (FSDEA), Angola’s sovereign wealth fund, retained its strong position in the latest Q2 2015 Linaburg-Maduell Transparency Index concluded by the Sovereign Wealth Fund Institute (SWFI). FSDEA scored eight out of ten points, earning its rank in the league of the top rated global sovereign wealth funds in terms of compliance with international best practice.
“These positive ratings underline FSDEA’s resolve to operate in accordance with the highest professional, ethical and responsible manner,” José Filomeno dos Santos, Chairman of the Board of Directors of FSDEA, said. “The Angolan government set stringent mechanisms to ensure that FSDEA adheres to the industry’s best practice of sovereign wealth fund management. In 2016 and beyond, we will continue to comply with these principles to meet the ultimate aim of being accountable to the people of Angola.”……………………………………….Full Article: Source

World’s largest public pension fund posts $64 billion loss

Posted on 01 December 2015 by VRS  |  Email |Print

Japan’s public pension reserve fund, the largest of its kind in the world, posted its biggest quarterly loss since the financial crisis for the quarter through September, dragged down by a global stock selloff. The Government Pension Investment Fund lost ¥7.89 trillion ($64.22 billion) in the three months to September, or 5.59%, bringing the value of its total assets to ¥135.1 trillion. That was the largest percentage-point fall on quarter since 2008.
The release gives a view of how pension funds, endowments and sovereign-wealth funds around the world were hit by a global selloff that erased trillions of dollars in value from financial markets amid concerns about growth in China and expectations for an interest-rate increase in the U.S. Norway’s sovereign-wealth fund, the largest in the world, lost 4.9% in the third quarter, its worst quarter in four years………………………………………..Full Article: Source

Alaska Permanent falls 4.4% in third quarter

Posted on 24 November 2015 by VRS  |  Email |Print

Alaska Permanent Fund Corp., Juneau, returned -4.4% for the quarter ended Sept. 30, ahead of its -5.5% benchmark, said a news release from the $50.5 billion sovereign wealth fund. Falling global equity markets drove much of the decline in the fund’s first quarter of its fiscal year.
Domestic equities returned -7.7% for the quarter; international equities, -12.9%; and global equities, -8.8%. Top performers included private equity and real estate, which returned 5.5% and 3.8%, respectively. U.S. bonds were relatively flat at 0.2%. International bonds, infrastructure and absolute return were slightly negative, returning -1.6%, -0.5% and -1.7%, respectively………………………………………..Full Article: Source

NZ Super Fund’s responsible investor strategy pays off - Matt Whineray

Posted on 23 November 2015 by VRS  |  Email |Print

Being set up as a responsible investor was a smart move for New Zealand’s sovereign wealth fund, a report by NZ Super Fund has found. In a “white paper” released on Thursday by the NZ Super Fund, which manages just under $30 billion for the Government, says there is now strong evidence companies that do well on “environmental, social and governance” (ESG) fronts deliver better returns for investors.
These are companies that do not breach human rights, do not abuse the environment, and are well-managed and transparent………………………………………..Full Article: Source

Shell share price: Qatar fund sell-down stirs BG merger fears

Posted on 17 November 2015 by VRS  |  Email |Print

The Qatar Investment Authority, the Gulf state’s sovereign wealth fund, has divested $1 billion worth of shares in Royal Dutch Shell Plc and BG Group, casting doubts on whether the proposed mega-merger has the support of major shareholders within the two companies.
The QIA, which holds about 4.88 percent of Shell and 1.76 percent in BG Group, has sold 43 million shares in BG and a further 24 million in Shell over a period of less than three weeks near the end of October. “The market is concerned that these sales have been discriminatory towards BG, and therefore suggesting some underlying reason which might be worrying for the fate of the transaction,” analysts at Olivetree Financial said as quoted by The Telegraph……………………………………….Full Article: Source

CICC shares jump 6% in debut

Posted on 09 November 2015 by VRS  |  Email |Print

China investment bank CICC has just debuted in Hong Kong, climbing 6 per cent at the open. The state-backed bank raised $811m in an IPO late last month — a smaller flotation than initially planned as it seeks to convince investors of the potential to expand its sales and trading and wealth management operations.
CICC was formed as a joint venture between Morgan Stanley and China Construction Bank in the 1990s. It now counts China Investment Corporation, the country’s sovereign wealth fund, as its biggest shareholder. Shares sold by CIC accounted for just under 10 per cent of its initial public offering, with 90.1 per cent fresh equity. Other existing investors included private equity groups KKR and TPG who led the group that bought Morgan Stanley’s stake in 2010. After the sale, CIC now holds 30.1 per cent with GIC, Singapore’s sovereign wealth fund, holding 12.3 per cent. TPG and KKR hold 7.7 per cent and 7.5 per cent respectively………………………………………..Full Article: Source

Kazakh fund signs deal for 50-MW solar park expansion

Posted on 06 November 2015 by VRS  |  Email |Print

Kazakhstan’s sovereign wealth fund Samruk-Kazyna announced on Thursday that a wholly-owned entity has agreed with the United Green Group to double the capacity of a 50-MW solar plant in the Kazakh province of Zhambyl.
Samruk-Kazyna Invest LLP entered into the USD-105.5-million (EUR 97m) agreement during the Kazakh-British Business Council, which was held on November 3 as part of a visit to London by Kazakhstan’s President Nursultan Nazarbayev………………………………………..Full Article: Source

Exchange Fund turned around last month from huge loss: HKMA head

Posted on 06 November 2015 by VRS  |  Email |Print

The Hong Kong Exchange Fund turned around in October from the HK$36.8 billion in losses it made during the first three quarters of the year, the Hong Kong Economic Journal reported Friday. The report cited Norman Chan Tak-lam, chief executive of the Hong Kong Monetary Authority, who wrote in his blog that the fund basically turned around at the end of the month.
He said the manager of the sovereign fund, which fuels the HKMA’s efforts to maintain the peg between the Hong Kong dollar and the US dollar, has adopted defensive measures to minimize the fund’s losses.The fund has reduced its investment in long-term bonds and increased its holding of cash over the past two years to prepare for the potential impact on bond investments of an interest rate hike, Chan wrote………………………………………..Full Article: Source

SOFAZ earns $118 bln from ACG, Shah Deniz projects

Posted on 05 November 2015 by VRS  |  Email |Print

Azerbaijan’s state oil fund SOFAZ has earned $116.01 billion from 2001 to November 1, 2015 through the development of the giant Azeri-Chirag-Gunashli (ACG) block of oil and gas fields in the Azerbaijani sector of the Caspian Sea. SOFAZ told Trend on November 1 that the Fund gained $5.86 billion in January-October, 2015 within the framework of ACG project.
The ACG fields have been active since 1997. Its production first started at the Chirag part of the block. It was followed by Azeri Project; Central Azeri in February 2005, West Azeri in December 2005, and East Azeri in October 2006. The Deepwater Gunashli section launched production in April 2008………………………………………..Full Article: Source

Azerbaijan’s State Oil Fund reveals revenues from largest gas project

Posted on 05 November 2015 by VRS  |  Email |Print

The revenues of the State Oil Fund of Azerbaijan (SOFAZ) from the project for developing the Shah Deniz gas and condensate field in the Azerbaijani sector of the Caspian Sea totaled $2.4 billion from 2007 to Nov.1, 2015, SOFAZ told Trend Nov.3. SOFAZ said its revenues from the Shah Deniz project stood at $279 million in Jan.-Oct. 2015.
The contract for developing the Shah Deniz offshore field was signed on June 4, 1996. The field’s reserve is estimated at 1.2 trillion cubic meters of gas. The shareholders are: BP, operator (28.8 percent), AzSD (10 percent), SGC Upstream (6.7 percent), Petronas (15.5 percent), Lukoil (10 percent), NICO (10 percent) and TPAO (19 percent)………………………………………..Full Article: Source

Hong Kong Exchange Fund Had Biggest Quarterly Loss After Rout

Posted on 03 November 2015 by VRS  |  Email |Print

Hong Kong Exchange Fund, managed by the city’s de facto central bank, reported its largest quarterly loss in history by value, as stock prices plummeted amid a market rout. The fund, managed in its current form by the Hong Kong Monetary Authority from 1998, had an investment loss of HK$63.8 billion ($8.2 billion) in the three months ended September, according to a presentation by HKMA Deputy Chief Executive Eddie Yue to legislators today.
The loss was not the biggest by percentage terms, according to a spokeswoman, who didn’t give further details. Government institutions globally have suffered losses as stocks gyrated and currencies fluctuated on economic concerns, including a China slowdown and expectations of rising interest rates in the U.S. Norges Bank in October posted its biggest loss in four years, as Chinese stocks and Volkswagen AG dragged down returns of the world’s largest sovereign wealth fund………………………………………..Full Article: Source

Norway wealth fund suffers biggest loss in 4 years

Posted on 02 November 2015 by VRS  |  Email |Print

The world’s largest sovereign wealth fund posted its biggest loss in four years, dragged down by Chinese stocks and Volkswagen, just as the Norwegian government prepares to make its first ever withdrawals to plug budget deficits. The $860bn fund lost 273bn kroner ($32bn) in the third quarter, or 4.9%, the Oslo-based investor said. Its stock holdings declined 8.6%, while it posted a 0.9% gain on bonds and a 3% return on real estate. It was the first back-to-back quarterly loss in six years.
“We have to expect fluctuations in the value of the fund when there are large movements in the market,” said Yngve Slyngstad, its chief executive officer. “With the fund as big as it is today, this can have a considerable impact in the short term. The fund has a long-term horizon, however, and is in a good position to ride out short-term volatility.”……………………………………….Full Article: Source

Norway wealth fund drops €29.4bn amid market rout

Posted on 30 October 2015 by VRS  |  Email |Print

The world’s largest sovereign wealth fund, which is Norwegian, has posted its biggest loss in four years, just as the government is preparing to make its first ever withdrawals to plug budget deficits. The fund lost 273bn kroner (€29.4bn) in the third quarter, or 4.9%, as stocks declined 8.6% and bonds rose 0.9%, the Oslo-based fund said yesterday.
Real-estate holdings rose 3%. It was the first back-to-back quarterly loss in six years. “We have to expect fluctuations in the value of the fund, when there are large movements in the market,” Yngve Slyngstad, chief executive of the fund, said………………………………………..Full Article: Source

Norway oil fund reports third biggest loss ever

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s oil fund on Wednesday reported its worst quarterly loss in four years, as it was hit by a collapse in the Chinese stock market, and big losses on investments in Volkswagen and Glencore. Norges Bank Investment Management (NBIM) which manages the world’s largest sovereign wealth fund, reported the the fund’s value had declined by 4.9 percent over the period, losing a staggering 273bn kroner ($32bn).
NBIM said the loss represented the third weakest result in kroner since the fund was launched. “The negative return on equity investments was driven by the slowdown in the global economy and the decline in global equity markets, especially the Chinese market,” Yngve Slyngstad, NBIM’s chief executive, said in a statement. ……………………………………….Full Article: Source

Norway oil fund’s investments value slide nearly 5%

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s sovereign-wealth fund, the world’s biggest by assets, reported a near five percentage-point loss on its investments in the third quarter, pulled down by negative returns from its equity investments amid weaker global markets.
Norges Bank Investment Management, the arm of the central bank that manages the fund, said Wednesday that the value of the fund’s investments fell by 273 billion Norwegian kroner ($32.17 billion) before the impact of a weaker Norwegian krone in the period………………………………………..Full Article: Source

Norway’s oil fund makes 2nd quarterly loss in row

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s $863 billion sovereign wealth fund made a loss on its investments in the three months ended September for the second quarter in a row, as stocks continued to drop and Volkswagen weighed on results, the fund said today.
The fund lost 273 billion crowns ($32 billion) in the quarter, after a loss of 73 billion from April to June, equivalent to a return on investment of minus 4.9% in the third quarter, against minus 0.9% in the second quarter. Those losses were recouped in October, with the fund earning some 300 billion crowns, the fund’s chief executive later said………………………………………..Full Article: Source

Azerbaijan Oil Fund’s investment portfolio exceeds limit for 2015 by 28.7%

Posted on 28 October 2015 by VRS  |  Email |Print

By 1 October 2015 the State Oil Fund of Azerbaijan (SOFAZ) exceeded the limit of investment portfolio (AZN 28.2 bn) for 2015 by 28.7%. The Fund reports that its investment portfolio in manats, as a base currency, grew by 26% from AZN 28.79 bn up to AZN 36.28 bn for the past 3 quarters. Over the 3 rd quarter the decline totaled AZN 1.176 bn or 3.1%. By 1 October the Fund’s investment portfolio was estimated at $34.6 bn.
The main directions (investment program) of SOFAZ money spending for 2015 are to pursue investment policy aimed at obtaining the highest possible income with minimum risk of losing assets. Fund’s investment portfolio for 2015 is limited to AZN 28.2 bn. The Fund is allowed the following currency structure: 50% of finances in US dollars, 35% in euro, 5% in pounds of sterling and the remaining 10% in other currencies………………………………………..Full Article: Source

Azeri oil fund’s assets drop by 6.4 pct to $34.7 bln by Oct. 1

Posted on 27 October 2015 by VRS  |  Email |Print

Azerbaijan’s state oil fund’s (Sofaz) assets fell by 6.38 percent to $34.7 billion by Oct. 1 from the start of the year, the fund said on Monday, hit by the drop in global oil prices. Sofaz holds the proceeds from oil contracts, oil and gas sales, transit fees and other revenue. It uses income from investments to fund social spending and infrastructure projects.
The fund said its revenue reached 5.5 billion manats ($5.2 billion) by Oct. 1, while expenditures were 6.4 billion manats. Sofaz said in September it had made its first real estate investment in Japan, buying retail property Kirarito Ginza in Tokyo for 52.3 billion yen ($432.27 million) with Mitsubishi UFJ Trust and Banking Corporation………………………………………..Full Article: Source

Future Fund returns pretty super

Posted on 22 October 2015 by VRS  |  Email |Print

You have to wonder how Peter Costello and his Future Fund team do it. At a time of intense global financial market volatility, the fund still managed to add $600 million - a return of 0.5 per cent - to its ever-growing investment pool during the September quarter.
Compare that to Super Ratings research, which shows the median return on “balanced option” superannuation accounts during the same period returned declined by 1.7 per cent. The Future Fund also outgunned the same super accounts for every comparable return period - one, three, five and seven years - by a significant margin. It also was comfortably ahead of its own legislated target return of CPI plus 4.5 per cent………………………………………..Full Article: Source

Future Fund grows despite global market ructions

Posted on 19 October 2015 by VRS  |  Email |Print

Australia’s $118 billion sovereign wealth fund managed to keep its head above water over the volatile September quarter, growing the fund by $600 million during a period when global sharemarkets saw their worst performance in four years.
However, Future Fund chairman Peter Costello has warned again of lower expected returns in the long term, after the fund managed to eke out a gain of 0.5 per cent over the three months to September 30, taking the total value of the fund to $117.8bn. The 0.5 per cent rate of return over the period was below the Future Fund’s target of 1.6 per cent for the quarter, but came at a time when global sharemarkets, including the Australian bourse, posted their worst performance since 2011………………………………………..Full Article: Source

Australia’s Future Fund returns 0.5 pct in Sept qtr

Posted on 19 October 2015 by VRS  |  Email |Print

Australia’s sovereign wealth manager, the Future Fund, said on Monday it returned 0.5 percent in the September quarter, marking slower growth for the fund which has returned an average 11.1 percent annually over five years. The fund, which has consistently outperformed its target return since it was set up in 2006, also fell short of its July-September target of 1.6 percent.
Future Fund Chairman Peter Costello reiterated that returns were likely to decline amid a large correction in Australian equities and increased volatility generally. Australian shares fell about 8 percent in the three months to September, the worst quarterly performance since 2011, largely due by fears about slowing growing in China and uncertainty about the timing of U.S. interest rate hike………………………………………..Full Article: Source

Future Fund issues return warning

Posted on 19 October 2015 by VRS  |  Email |Print

The Future Fund has issued a warning to investors that the high returns of the past few years are unlikely to continue in the medium term. The latest update shows the Future Fund’s investment strategy has almost doubled the value of original government contributions since its inception.
Since its launch in May 2006, the sovereign wealth fund has added $57.3 billion in investment returns to the government’s original contributions, which were valued at $60.5 billion at the time of transfer. The performance translates to annualised return of 7.8%, comfortably ahead of the long-term target return of CPI +4.5%, which equates to 7.1%. Performance is also well ahead over one, three, five and seven years………………………………………..Full Article: Source

UBS Sees Sovereign Assets Shrinking by $1.2 Trillion

Posted on 15 October 2015 by VRS  |  Email |Print

Central bank and sovereign wealth fund assets will shrink by $1.2 trillion, or almost 7 percent, by the end of the year as China and petrostates including Russia and Saudi Arabia dip into their savings amid slower growth and lower crude revenues, according to UBS Group AG.
The decline will be driven by China withdrawing its foreign exchange reserves, while oil-producing countries tap foreign assets to support government spending, Massimiliano Castelli, head of global strategy at UBS Asset Management, said in a phone interview from Zurich Tuesday………………………………………..Full Article: Source

Fitch Affirms Kazakhstan’s Sovereign Wealth Fund Samruk-Kazyna at ‘BBB+’

Posted on 09 October 2015 by VRS  |  Email |Print

Fitch Ratings has affirmed Kazakhstan-based JSC Sovereign Wealth Fund Samruk-Kazyna’s (SK) Long-term foreign currency Issuer Default Rating (IDR) at ‘BBB+’, Long-term local currency IDR at ‘A-’, National Long-term rating at ‘AAA(kaz)’ and Short-term foreign currency IDR at ‘F2′.
The Outlooks on the Long-term ratings are Stable. Fitch has also affirmed SK’s senior unsecured domestic bonds at Long-term local currency ‘A-’ and at National Long-term ‘AAA(kaz)’. The affirmation of the IDRs and senior debt ratings reflects SK’s unchanged strategic importance, and its special legal status as a sovereign wealth fund and the state’s key asset management company, 100% owned by Kazakhstan (BBB+/A-/Stable)………………………………………..Full Article: Source

Korea wealth fund tumbles on spending, low returns

Posted on 06 October 2015 by VRS  |  Email |Print

The Korea Investment Corporation (KIC) has come under criticism due to its extravagant spending despite its worsening performance. In an annual National Assembly inspection of the country’s sovereign wealth fund on Oct. 2, KIC Chairman and CEO Ahn Hong-chul was questioned about the fund’s expenditures for his business trips and declining investment gains.
Ahn spent a total of 250 million won ($213,000) for 32 business trips from January 2014 to August of this year. He received 408 million won in annual salary last year, topping his fellow CEOs at 310 other public organizations, according to representatives from both the ruling Saenuri Party and the main opposition New Politics Alliance for Democracy (NPAD)………………………………………..Full Article: Source

Azerbaijani State Oil Fund reveals volume of revenues from Shah Deniz project

Posted on 05 October 2015 by VRS  |  Email |Print

The State Oil Fund of Azerbaijan (SOFAZ) received $2.39 billion from the implementation of the project for development of Shah Deniz gas and condensate field in the Azerbaijani sector of the Caspian Sea from 2007 to Oct.1, 2015, SOFAZ told Trend.
SOFAZ said it has received $274 million within the Shah Deniz project in Jan.-Sept. of 2015. The contract for development of the Shah Deniz offshore field was signed on June 4, 1996. The field’s reserve is estimated at 1.2 trillion cubic meters of gas. The shareholders are: BP, operator (28.8 percent), AzSD (10 percent), SGC Upstream (6.7 percent), Petronas (15.5 percent), Lukoil (10 percent), NICO (10 percent) and TPAO (19 percent)………………………………………..Full Article: Source

Sovereign funds double deal value

Posted on 05 October 2015 by VRS  |  Email |Print

Sovereign wealth funds spent a total of US$24.9 billion (S$35.6 billion) on overseas acquisitions in the third quarter of 2015, almost double the previous quarter as they chased after trophy assets. Thomson Reuters data shows that these funds, which invest windfall revenues from oil and other commodity exports for future generations, were involved in 28 deals in the July-September period, down 10 from the previous quarter.
Singapore’s investment funds GIC and Temasek were part of separate consortiums that featured in the top two deals in that quarter. Total value is still shy of the US$30.6 billion peak reached in the last quarter of last year, when sovereign funds were buying up assets at their fastest rate since the financial crisis………………………………………..Full Article: Source

Sovereign wealth funds double deal volumes to $24.9 bln in Q3

Posted on 02 October 2015 by VRS  |  Email |Print

Sovereign wealth funds spent a total of $24.9 billion on overseas acquisitions during the third quarter of 2015, almost double the previous quarter as they chased after trophy assets. Thomson Reuters data shows that sovereign wealth funds, which invest windfall revenues from oil and other commodity exports for future generations, were involved in 28 deals during the July-September period, down 10 from the previous quarter.
Deal volumes are still shy of the $30.6 billion peak reached in the last quarter of 2014, when sovereign funds were buying up assets at their fastest rate since the financial crisis. But it marks a significant rebound from the first quarter when deal value slipped to $5.4 billion for 32 transactions………………………………………..Full Article: Source

Bahrain SWF overcomes bout of turbulence

Posted on 02 October 2015 by VRS  |  Email |Print

Bahrain’s sovereign wealth fund, Mumtalakat, has weathered economic and political uncertainty both at home and throughout the wider Middle Eastern region, and is now back on a path to growth, with its aviation holdings being at the forefront of this turnaround.
More diversified than its Gulf Co-operation Council (GCC) peers, Bahrain’s economy has weathered the oil price downturn relatively well. Though government revenues have been slashed, the resilience of the country’s non-oil economy is expected to see gross domestic product growth (GDP) hit 3.6% by the end of 2015, according to the Bahrain Economic Development Board………………………………………..Full Article: Source

Fundo Soberano de Angola announced 2014 results

Posted on 01 October 2015 by VRS  |  Email |Print

The Fundo Soberano de Angola (FSDEA), Angola’s sovereign wealth fund, has announced the audited results for 2014, reflecting the Fund’s fiscal position and investment activity for the year. Deloitte & Touche independently audited the financial statements of the sovereign wealth fund for the second consecutive year.
The financial statements of the FSDEA show total assets of $4.88 billion as of 31 December 2014. Highlights of the investment portfolio of FSDEA at the end of the period are as follows: Fixed Income Assets were $2.7 billion representing 56 per cent of the investment portfolio; Investment funds in private equity, for infrastructure and hotels, accounted for $1.6 billion, equivalent to 34 per cent of the investment portfolio; 37 per cent of the investment portfolio was allocated in Europe, 34 per cent in Sub Saharan Africa, 18 per cent in North America and 11 per cent in the rest of the world………………………………………..Full Article: Source

Glencore shares collapse leaves wealth funds with big losses

Posted on 30 September 2015 by VRS  |  Email |Print

The further collapse of Glencore’s share price this week has spooked world markets as the prospect of a deeper commodities depression looms, while leaving its sovereign wealth fund investors with deep losses.
Glencore was heavily backed by Aabar Investments, a unit of the International Petroleum Investment Company (Ipic), when it floated its shares on the London Stock Exchange in 2011. Aabar at the time was a “cornerstone” investor, taking a US$1 billion stake when the company was initially valued at about $60bn, which made it Glencore’s largest investor apart from company executives………………………………………..Full Article: Source

Qatar fund loses $6bn in 10 days

Posted on 30 September 2015 by VRS  |  Email |Print

Qatar’s sovereign-wealth fund lost $5.9 billion on paper in 10 days from its stakes in Volkswagen and Glencore. Qatar Investment Authority, the biggest holder of VW’s preferred shares and the third-largest owner of its common shares, lost about $4.8 billion from its holdings of the automaker.
The wealth fund is also the largest investor in the mining company Glencore, a stake that declined by about $1.1 billion in the same period. The loss calculations assume the fund hasn’t added to or reduced its holdings since the latest disclosures. The ownership data are based on Bloomberg compilations from the latest available regulatory filings. Daniela Fleischmann, a spokeswoman for the fund at Finsbury, declined to comment on the holdings………………………………………..Full Article: Source

Most Alaskans will get record $2,072 each in oil money

Posted on 22 September 2015 by VRS  |  Email |Print

Oil prices are so low that they are hovering at benchmarks not seen in years, plunging oil-dependent Alaska into a crippling budget deficit. But the industry’s woes won’t affect how much the state’s oil investment account pays out to Alaskans, even though the government has been scrambling to pay the bills.
This year’s payout will be a record $2,072 for nearly every man, woman and child who lives in the 49th state. Last year’s check was $1,884, and the previous high was $2,069 in 2008. State officials had seventh-grader Shania Sommer announce the dollar amount at a news conference Monday, with Gov. Bill Walker declaring, “This really is about the next generation.”……………………………………….Full Article: Source

Abu Dhabi’s Mubadala posts sharp loss on oil price fall

Posted on 18 September 2015 by VRS  |  Email |Print

Abu Dhabi’s investment fund Mubadala on Thursday posted a 52-percent drop in profits for the first half of 2015, hit hard by the slide in global oil prices. The group tasked with diversifying the Gulf state’s energy-dependent economy has a global investment portfolio that includes US-based technology giant GE, EMI Music Publishing, and Italy’s Piaggio Aerospace.
Mubadala said profits in the first six months of the year stood at 625.5 million dirhams ($170.4 million) compared with 1.3 billion dirhams in the same period in 2014. Revenues came in at 15.9 billion dirhams, less than one percent lower from the year before………………………………………..Full Article: Source

SOFAZ announces 2016 revenues and expenditures

Posted on 15 September 2015 by VRS  |  Email |Print

State Oil Fund of Azerbaijan’s revenues are forecasted to make AZN 6,711.6 mln, down AZN 3,534.1 mln or 34.5% from 2015. According to Finance Ministry, the expenditures will make AZN 8,200.0 mln, down AZN 4,104.8 mln or 33.4% from 2015.
AZN 6,000,000 or 73.2% of revenues are planned to be transferred to the state budget, AZN 2,150.5 mln or 26.2% - to funding of several infrastructural projects, AZN 49.5 mln or 0.6% to State Programs on “Study of Azerbaijani youth abroad for 2007-2015”, “Study of young professionals abroad for 2016-2020” and “Improvement of Teaching ability in high schools and promotion of scientific researches”………………………………………..Full Article: Source

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