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Sovereign Wealth Funds Briefing - Category | Research more

Oil-centric sovereign wealth funds

Posted on 30 November 2016 by VRS  |  Email |Print

Among the largest sovereign wealth funds, oil- and gas-related revenues account for just less than 57% of total assets, including four of the top five funds largest by assets, derive their assets from their energy industry. Norway’s Government Pension Fund Global sits atop the list with $885 billion in assets.
While Norway is not a member of OPEC, the fund will be directly impacted by the meeting results. The fund has been faced with budget shortfalls due to lower revenues and low investment returns; its oil production has approached five-year highs during 2016………………………………………..Full Article: Source

China Sovereign Wealth Fund to Start Research Institute

Posted on 08 November 2016 by VRS  |  Email |Print

China Investment Corporation (CIC), the country’s sovereign wealth fund, will set up a research institute to promote international trade and investment. Starting on Saturday, CIC will hold four recruitment sessions for overseas Chinese talent in Chicago, New York, Boston and San Francisco.
Qi Bin, the CIC’s executive vice president, will be hosting these sessions, talking about the challenges and opportunities China is facing, and what role the CIC research institute is going to play in facilitating the country’s growing overseas investments………………………………………Full Article: Source

African Sovereign Wealth Funds

Posted on 01 November 2016 by VRS  |  Email |Print

Africa has experienced a growth spurt in the last decade largely because of rising commodity prices. But that can’t last forever, and it hasn’t. Partly as a hedge and partly as an economic development vehicle, several African nations started sovereign wealth funds (SWFs) to occasional controversy.
Global SWF assets have doubled since the 2008 financial collapse to more than $7.2 trillion in 2015. SWFs in Africa are blooming and now manage assets over $160 billion, which represent more than 6 percent of the continent’s Gross Domestic Product. Angola’s SFW is one of the continent’s largest. Launched in October 2012, Fundo Soberano de Angola, or FSDEA, was endowed with $5 billion in assets and a mandate to promote economic and social development in Angola and Sub-Saharan Africa………………………………………Full Article: Source

Pew report sees Alaska ahead of other states in its ‘sovereign wealth fund’

Posted on 12 October 2016 by VRS  |  Email |Print

The Pew Charitable Trusts focused on seven states that have funds from extraction revenue, which the report describes as “sovereign wealth funds.” According to Pew, Alaska is one of only two state funds whose purpose is well-defined by state law. And the report found that it’s one of three states that doesn’t allow withdrawals from the fund principal.
Brenna Erford helped write the report and manages Pew’s work on state budget policy. She praised the foresight Alaska officials and voters had when they established the fund in 1976………………………………………Full Article: Source

The sovereign wealth fund

Posted on 21 September 2016 by VRS  |  Email |Print

The sovereign wealth funds are the national investments many countries have made for their future generations. Some of these funds are huge, as seen by the figures presented in the next paragraph. The sovereign wealth funds have huge clout internationally – whether economic or geopolitical. Collectively or singularly, they can move markets, destabilise currencies or change governments.
The petrodollar wealth funds emerged in the 1970s, when the oil producing economies had surplus funds which they did not know where to park. Henry Kissinger was the brain behind the petrodollar sovereign wealth funds. As America’s chief strategist, he wanted to ensure that the surplus funds of the oil producing economies were invested in dollars – hence petrodollars………………………………………Full Article: Source

This Way to the Egress

Posted on 07 September 2016 by VRS  |  Email |Print

Sovereign wealth funds were once referred to as white knights when it came to them bailing out a number of global investment banks such as Citigroup, Merrill Lynch and UBS during the financial calamity of 2007. To this day, wealth funds continue to amass tremendous financial firepower in the trillions, despite headwinds such as the oil glut, heightened geopolitical tensions, slowdown of global consumer demand and the possible rise of new protectionism.
In 2014, sovereign wealth funds directly invested US$ 33.4 billion into the financial sector, according to data from SWFI’s Sovereign Wealth Fund Transaction Database. In 2015, the sovereign fund transaction figure toward financials dramatically fell to just US$ 18.76 billion. There has been a clear shift in what sovereign wealth funds want and are willing to invest millions into………………………………………..Full Article: Source

After years of success, Future Fund prepares for hard times

Posted on 02 September 2016 by VRS  |  Email |Print

Chairman Peter Costello can justifiably be proud of the achievements of the Future Fund. Ten years after he established it as federal treasurer — setting up strict guidelines for its operation, to set aside what were windfall profits to help meet superannuation liabilities for public servants — the fund has doubled in size.
From government seed capital of $60.5 billion (proceeds from of the sale of Telstra and budget surpluses), the fund has grown to $123bn from its own investments………………………………………..Full Article: Source

What Australia could have learnt from Norway’s sovereign wealth bonanza

Posted on 31 August 2016 by VRS  |  Email |Print

Norway built the biggest sovereign wealth fund in the world by investing a share of revenue from its offshore oilfields. Australia should have followed its example with the money from the mining boom.
Had a little smart thinking been applied, Australia’s biggest and longest ride on the resources rollercoaster since the 1850s gold rush could have been very beneficial indeed………………………………………Full Article: Source

Africa’s friends reviewed - A case study of sovereign wealth funds

Posted on 25 August 2016 by VRS  |  Email |Print

Over the years, Africa has had many friends or those who claim to be friends, but who among these is betting her funds on the continent? It’s one thing to hand out grants and another to bet citizens’ funds in a cause or economy you believe in. Going by sovereign wealth funds, Norway is betting a lot on the African continent.
So, what is a sovereign wealth fund? In layman’s terms, a sovereign wealth fund is an investment pool of foreign reserves owned and managed directly or indirectly by a government………………………………………..Full Article: Source

Norway’s wealth fund – key points

Posted on 18 August 2016 by VRS  |  Email |Print

Norway’s $890bn oil fund – the world’s largest sovereign wealth fund – eked a 1.3 per cent return in the second quarter, despite market volatility in the wake of the Brexit vote. Here fastFT pulls out some key figures from its second quarter performance.
The fund was not immune from the market turmoil that followed Britain’s vote to leave Europe. Precisely 59.6 per cent of the fund is invested in equities, which returned 0.7 per cent during the quarter but returns on European equities – 37.2 per cent of the fund’s total equities investments – fell 3 per cent. The UK is the fund’s biggest European market, accounting for 10.6 per cent of its equity investments and returned -3.4 per cent during the quarter………………………………………..Full Article: Source

Of $40 oil and forced SWF selling

Posted on 09 August 2016 by VRS  |  Email |Print

You know who doesn’t like a falling oil price? Sovereign wealth funds for countries dependent on high oil prices and in love with their (endangered) petrodollars. And a risk based on that dislike is a presumption of forced selling and equity market weakness becoming self-fulfilling as/ if oil prices slide. Stable oil prices means SWFs don’t have to suddenly liquidate but the opposite would also seem to be true…
A $40 average oil price, and assuming that these reserve managers and SWFs sell in accordance to their average allocation, would imply selling of $118bn of government bonds and $45bn of public equities………………………………………..Full Article: Source

Gurus Worried, What Should Sovereign Funds Do?

Posted on 09 August 2016 by VRS  |  Email |Print

Several prominent investment gurus have recently made public comments regarding the state of the markets - playing a bearish tone of what is to come. Even investment banking mammoth Goldman Sachs gave a warning signal, as well as GOP U.S. Presidential candidate Donald J. Trump chiming in on August 2, 2016 on Fox Business, “I did invest, and I got out, and it was actually very good timing.”
More and more asset owners are anticipating a world where listed equities will no longer be substantial enough to carry returns for their expanding liabilities. While this monstrous shift in institutional investor asset allocation has lushly lined the pockets of alternative mangers, it does draw concern about the effectiveness of the major asset classes. This was clearly demonstrated in the latest fiscal year returns of CalPERS, Temasek Holdings, CalSTRS, China Investment Corporation, Abu Dhabi Investment Authority, etc………………………………………..Full Article: Source

Inside Ireland’s €8 billion Strategic Investment Fund

Posted on 08 August 2016 by VRS  |  Email |Print

Abrakebabra; Lily O’Brien’s. The AA. Carrolls Cuisine. House building. Student accommodation. Office blocks. Loans to milk farmers. Life-changing drug treatments and technology R&D. Is there any part of the economy that the state-backed Irish Strategic Investment Fund (ISIF) doesn’t touch?
At €8 billion, it may not be one of the world’s biggest sovereign wealth funds, but in a country the size of Ireland’s it is huge. It is so big that it has to be careful that any money it places in a fund doesn’t cause distortions across the whole economy………………………………………..Full Article: Source

Browne: Heritage & Stabilisation Fund not following best practices

Posted on 04 August 2016 by VRS  |  Email |Print

Trinidad and Tobago’s sovereign wealth fund (SWF), the Heritage and Stabilisation Fund (HSF), is not following best practices as outlined in the Santiago Principles and exemplified by the Norway’s SWF, Mariano Browne, a former minister of state in the Ministry of Finance said last month.
Delivering the feature address on July 21 at a special general meeting of the Trinidad and Tobago Transparency Institute (TTTI) at Fernandes Industrial Centre in Laventille, Browne, now the managing partner of Elida Management Services, looked at the comparable T&T Securities and Exchange Commission (TTSEC) Act which requires all publicly listed companies to report every 90 days. The HSF falls short of that standard, he said………………………………………..Full Article: Source

Sovereign funds’ European shareholdings up to four times bigger than thought

Posted on 03 August 2016 by VRS  |  Email |Print

Sovereign wealth funds’ combined shareholdings are likely to be far bigger than previously thought, running to an average of at least 6-7 percent for Europe’s largest listed companies, according to a study.
Some Gulf-based government funds are likely to own four times as many European shares as companies’ management believe, the study by Nasdaq Corporate Solutions also found. The study tracked share ownership in 20 major European companies from five countries and different sectors. The group provides analysis of shareholder and investor activity including on the $6.5 trillion sovereign wealth sector………………………………………..Full Article: Source

Avoiding the Pitfalls: Invest in Skills for Deal Evaluation

Posted on 03 August 2016 by VRS  |  Email |Print

Venture and private equity investment are important components of the portfolios of sovereign wealth funds (SWFs). However, access to these asset classes has come with hefty management fees. For SWFs, there are several advantages to direct investment in venture and private equity deals.
Direct investment allows more control over the timing of actual investments. It also allows the SWFs to have more flexibility in their portfolio construction. And most importantly, there are significant savings on management and performance fees. SWF managers need to be adept at analyzing whether their returns will beat the realized return (after fees) offered by venture capital and private equity firms. Unfortunately, ample evidence has shown that this can be very challenging for many SWFs making direct investments………………………………………..Full Article: Source

SWF safety net disappears amid commodities rout

Posted on 02 August 2016 by VRS  |  Email |Print

According to a report from Bocconi University in Milan, the flow of funds from Sovereign wealth funds (SWFs) that formed a safety net during the last financial crisis of 2008/09 in the form of direct investment has disappeared. SWFs are investing less money now, compared to last five years. In 2015, the SWFs invested only $48 billion directly which is 57 percent lower compared to 2008, when they invested $112 billion.
World’s largest SWFs belong to countries producing natural resources, mainly oil. Norway, which is major oil exporter has world’s largest SWFs, followed by Saudi Arabia and Qatar………………………………………..Full Article: Source

Sovereign wealth funds to become largest private equity allocator

Posted on 27 July 2016 by VRS  |  Email |Print

Sovereign wealth funds could overtake public pension funds as the most significant source of private equity capital in the next five years, David Rubenstein, co-founder and co-chief executive officer of Carlyle Group told attendees at the Private Equity Exclusive conference in Chicago on Monday.
U.S. public pension funds have historically been the biggest source of capital for private equity firms and today account for 30% to 35% of capital, Mr. Rubenstein. However, sovereign wealth fund assets are growing rapidly, expected to increase to $9 trillion by 2020 from $1 trillion in 2004, Mr. Rubenstein said, citing PricewaterhouseCoopers report on asset management in 2020………………………………………..Full Article: Source

The DoJ 1MDB complaint analysed: how the named banks fare

Posted on 26 July 2016 by VRS  |  Email |Print

The US Department of Justice’s complaint seeking the recovery of assets related to the Malaysian sovereign wealth fund, 1MDB, is compelling reading. In a 136-page filing, a remarkable web of money transfers and illicit purchases is exposed.
Several banks are involved in it and three more have since been rebuked by the Monetary Authority of Singapore for failing to implement proper money laundering checks. So who comes out of it in the best and worst shape? Here is a quick guide:……………………………………….Full Article: Source

SMRT triple-A credit rating not affected by Temasek’s buyout offer, says S&P

Posted on 22 July 2016 by VRS  |  Email |Print

S&P Global Ratings said on Thursday (July 21) that its credit rating on SMRT is not affected by the Temasek Holdings buyout offer for the rail and bus operator.
“Our rating already incorporates a very strong link between the company and its majority owner, the Government of Singapore, through Temasek, which is unlikely to change even if the company becomes a wholly owned subsidiary,” said S&P, which rates SMRT as triple-A with a stable outlook………………………………………..Full Article: Source

3 Things Investors Should Know About Temasek’s Bid For SMRT Corporation Ltd

Posted on 22 July 2016 by VRS  |  Email |Print

SMRT Corporation Ltd has made two huge announcements in short order. Last Friday, the land transport services provider revealed that it plans to sell its rail operating assets to the Land Transport Authority (LTA) for S$1 billion. The sale, if it happens, would effectively change the company’s business model from asset-heavy to asset-light. It’s a deal that may change SMRT Corporation’s business significantly – you can find out more about the possible changes here.
Then, yesterday, SMRT Corporation announced that its largest shareholder, Temasek Holdings, has released a buyout offer. Temasek, which is one of the Singapore government’s investing arms, currently owns 54% of SMRT Corporation’s shares and it wants to buy the remaining 46% stake………………………………………..Full Article: Source

The world’s top ten biggest sovereign wealth funds

Posted on 15 July 2016 by VRS  |  Email |Print

In the midst of collapsing oil prices, oil-funded sovereign wealth funds (SWFs) are under pressure to liquidate assets, according to political risk advisory firm GeoEconomica. There was roughly a 20 per cent fall over the past year in the deposits and reserves stored in the Saudi Arabian Monetary Agency (SAMA) by the Saudi government, according to estimates. This suggests that oil giants such as Saudi Arabia are now seeking to protect their budgets against dramatically declining revenues.
SWFs are managed separately from a county’s official currency reserves. They are pools of money the government stores in funds or corporations to generate profits. The funds have an original purpose of reducing the volatility of government revenues and help counter any drops in the national economy………………………………………..Full Article: Source

The world’s 10 biggest sovereign wealth funds

Posted on 14 July 2016 by VRS  |  Email |Print

In the midst of collapsing oil prices, oil-funded sovereign wealth funds (SWFs) are under pressure to liquidate assets, according to political risk advisory firm GeoEconomica. There was roughly a 20 per cent fall over the past year in the deposits and reserves stored in the Saudi Arabian Monetary Agency (SAMA) by the Saudi government, according to estimates.
This suggests that oil giants such as Saudi Arabia are now seeking to protect their budgets against dramatically declining revenues. SWFs are managed separately from a county’s official currency reserves. They are pools of money the government stores in funds or corporations to generate profits………………………………………..Full Article: Source

Brexit unlikely to hit GCC sovereign wealth funds – Moody’s

Posted on 13 July 2016 by VRS  |  Email |Print

The UK’s vote to leave the European Union (EU) will have a “negligible” impact on GCC sovereigns’ credit ratings, Moody’s said in a statement on Tuesday. The rating agency said GCC sovereign wealth funds have limited trade exposure to the UK and their sheer size offers resilience against potential fluctuations in the value of their assets.
Its latest report, ‘Sovereigns – Brexit and the Gulf Cooperation’, said that sovereign wealth fund portfolios are typically large and well diversified, allowing them to absorb the impact of asset price and exchange rate movements associated with Brexit………………………………………..Full Article: Source

SWFs curb cross-border investments

Posted on 13 July 2016 by VRS  |  Email |Print

Direct investments from sovereign wealth funds saw a 42 percent drop in the first half of the year compared with the same period in 2015, according to research from the Sovereign Wealth Fund Institute (SWFI).
‘For the first half of 2016, wealth funds and other public pension investors invested $73.2 bn directly,’ write the researchers. ‘This is a sharp decline from the $126.7 bn directly invested in the first half of 2015.’ That doesn’t mean there aren’t still significant sums being invested however, with the SWFI noting an interest in disruptive technology………………………………………..Full Article: Source

Kuwaiti investments in the UK may hit by Brexit

Posted on 13 July 2016 by VRS  |  Email |Print

Kuwaiti investments in the United Kingdom are expected to be hit by the United Kingdom’s decision to leave the European Union, although the impact of Brexit is expected to be “short-term and not large”, Undersecretary Khalifa Hamada said.
The KIA, through its London-based subsidiary Kuwait Investment Office, is understood to have substantial investments in the Britain, in particular in real estate and infrastructure. It was part of the consortium which bought London City Airport earlier this year………………………………………..Full Article: Source

Sovereign investors’ M&A deals fall 26 percent by value in second quarter

Posted on 11 July 2016 by VRS  |  Email |Print

Sovereign investors, including wealth funds, made $14.1 billion worth of acquisitions in the second quarter, down 26 percent from the first three months of the year but underpinned by a rebound in real estate deals. Data compiled by Thomson from Reuters shows sovereign investors, a category that can include everything from state pension funds to oil-backed investment vehicles, were involved in 39 deals between April and June, six fewer than in the first quarter.
The single biggest deal was the $4.5 billion funding round for Ant Financial Services Group, an affiliate of China’s biggest e-commerce company, Alibaba Group Holding, which attracted China’s CIC Capital, amongst others………………………………………..Full Article: Source

Saudi Arabia, Abu Dhabi among largest sovereign wealth funds

Posted on 07 July 2016 by VRS  |  Email |Print

Saudi Arabia’s SAMA Foreign Holdings fund was ranked fourth in the list of the world’s largest sovereign wealth funds, despite its assets falling by $33.9 billion to $598.4 billion by the end of Q2-2016, the Sovereign Wealth Fund Institute (SWFI) said in its monthly report for June.
The kingdom’s Public Investment Fund (PIF) maintained its position as the 13th largest sovereign wealth fund with assets amounting to $160 billion in the same period. Meanwhile, the Abu Dhabi Investment Authority (ADIA) remained second on the list, with assets growing by $19 billion to $792 billion………………………………………..Full Article: Source

Sovereign wealth & buyout funds step up in June quarter

Posted on 01 July 2016 by VRS  |  Email |Print

Private equity (PE) entities invested $3,602 million across 129 deals during the quarter ended June, as against $4,278 mn across 169 transactions in the same period last year, about 16% less. According to Venture Intelligence, the investment was 7% lower than the immediate previous quarter ($3,890 mn across 169 transactions).
Singalore’s sovereign wealth fund, GIC, and Abu Dhabi’s ADIA and Malaysia’s Khazanah participated in mega investments. As with the renewable power-focused Greenko Group (that raised $230 mn from ADIA and GIC) and analytics BPO firm Fractal Analytics ($100 mn from Khazanah). Canada-based Fairfax Group committed $300 mn to chemicals manufacturer Sanmar Group (on the heels of its $321 mn bet in Bangalore International Airport, announced in March)………………………………………..Full Article: Source

SWFs: Investing Directly and Creating Value

Posted on 28 June 2016 by VRS  |  Email |Print

Today, when sovereign wealth funds (SWFs) put assets into alternative investments, they are more likely to be direct, rather than passive, investors. One of Canada’s largest pension funds recently bought a significant minority stake in Allflex Group, the global leader in animal monitoring technology, joining Allflex’s leading shareholder, private equity firm BC Partners.
In India, a growing number of SWFs are reportedly interested in acquiring investment stakes in infrastructure companies that are expanding the nation’s roads and airports. The New York Times recently described SWFs as part of the group of so-called emerging buyers who bought about 17 percent of the assets sold by private equity firms since 2015, up from 2 percent almost a decade ago………………………………………..Full Article: Source

World’s 2nd-Biggest Sovereign Fund Sees Oil Glut Until Mid-2017

Posted on 23 June 2016 by VRS  |  Email |Print

The global oil glut will probably persist until at least next summer as markets take time to absorb excess crude in storage, according to the head of research at the world’s second-largest sovereign wealth fund.
Supply and demand for oil are coming back into balance, and the response of shale producers to rising prices will help determine how high crude can go, Christof Ruehl, the global head of research at Abu Dhabi Investment Authority, said……………………………………….Full Article: Source

GCC sovereign wealth funds adjusting long-term strategies

Posted on 20 June 2016 by VRS  |  Email |Print

As an inevitable consequence of a prolonged period of low oil prices, Gulf-based sovereign wealth funds are readjusting their long-term strategies, selling their financial assets abroad and pulling the money out at a rapid rate to fill the gaping budgetary holes. Also, there has been increased pressure on the them to invest in the local market in order to support projects troubled by budgetary cuts.
During the “golden era” (until 2014), when black gold was routinely traded above $100 per barrel, Gulf countries recorded capital inflow reaching epic proportions. They entrusted their enormous surpluses to their Sovereign Wealth Funds (SWF) which heavily invested in a variety of assets around the globe. But the financial circumstances of the Arab Gulf countries have changed dramatically………………………………………..Full Article: Source

Watchdogs exempt sovereign wealth and pension funds from study

Posted on 17 June 2016 by VRS  |  Email |Print

Sovereign wealth funds and pension funds have won a temporary break from tighter regulatory scrutiny, as global watchdogs exempted them from an ambitious study aiming to curb systemic risks from financial institutions that are not banks or insurers.
SWFs — which have grown in number and size in the past decade due to an accompanying spike in commodity prices — have an estimated $7tn in assets under management, according to the Sovereign Wealth Fund Institute, while pension funds manage about $35tn of assets across the globe………………………………………..Full Article: Source

SWF acquisitions rise 62 percent, highest level since 2008

Posted on 13 June 2016 by VRS  |  Email |Print

The value of acquisitions involving sovereign wealth funds has risen 62 percent to $28.6 billion in the year to date, the highest level since 2008, Thomson Reuters data showed on Friday. The Qatar Investment Authority (QIA), a sovereign wealth fund, this week agreed to buy a 43-story Singapore office tower for $2.5 billion from the world’s largest asset manager Blackrock, adding to a flurry of mergers and acquisitions (M&A) by sovereign wealth funds.
Industrials, financials and real estate account for nearly 80 percent of year-to-date sovereign wealth fund M&A activity, up from 33 percent a year ago, the data showed………………………………………..Full Article: Source

Auditing sovereign wealth funds: Qatar Investment Authority at the back of the class

Posted on 07 June 2016 by VRS  |  Email |Print

Despite a lot of changes in Qatar in the last few years, the country’s sovereign wealth fund, the Qatar Investment Authority (QIA), is still getting extremely bad marks from international auditors.
In the past few months, QIA officials announced fund managers are making big moves toward investing $35 billion in U.S. interests while opening an office in New York. The fund has hired top finance professionals from firms such as Citibank and Morgan Stanley. But none of that has, as yet, been enough to move the QIA from the bottom of the barrel in the eyes of organizations charged with monitoring sovereign wealth funds around the world………………………………………..Full Article: Source

Saudi’s massive Uber investment: What the analysts think

Posted on 03 June 2016 by VRS  |  Email |Print

News that Saudi Arabia’s sovereign wealth fund has pumped $3.5 billion into ride-hailing app Uber – reportedly the largest single investment ever made in a private firm – is a sign of new things to come, analysts say. The massive stake in San Francisco-based Uber, which values itself at around $62.5 billion, gives the kingdom’s Public Investment Fund a share of about 5 percent. It also gives Saudi a seat on Uber’s board of directors.
The announcement marks the first major foreign investment by the kingdom’s wealth fund since its April rollout of ‘Vision 2030,’ a plan to transform the country’s economy by the end of the next decade, and marks a break from a long-held focus on securing conservative, low-risk foreign assets………………………………………..Full Article: Source

Saudi Arabia invested $3.5 billion in Uber. That could be bad news for the global economy

Posted on 03 June 2016 by VRS  |  Email |Print

Uber has raised an astonishing $3.5 billion from Saudi Arabia’s sovereign wealth fund. It’s one of the biggest venture capital investments in history and brings Uber’s overall fundraising haul to $11 billion. But while Uber is bragging about the investment, it could reveal a troubling trend in investment trends overall.
In the long run, economic growth depends on our ability to convert cash into productive assets like factories, trucks, machinery, or computer software. But for the most part, recent “investments” in Uber aren’t like that. Uber is planning to use its billions to fund brutal, zero-sum price wars with competitors around the world………………………………………..Full Article: Source

Oil slump blamed for falloff in assets

Posted on 31 May 2016 by VRS  |  Email |Print

The decline in oil prices had a trickle-down effect on money managers that run assets for sovereign wealth funds in 2015. Total assets managed for sovereign wealth funds by money managers in Pensions & Investments’ universe were $1.04 trillion as of Dec. 31, down 13.7% from 12 months earlier.
In fact, every manager among the top 10 ranked by sovereign wealth fund assets under management recorded declines in those assets during 2015. State Street Global Advisors had the most sovereign wealth fund assets under management in 2015, at $103.4 billion, but still saw assets fall 8.8% from 2014. BlackRock (BLK) Inc. (BLK) was second in 2015, with $79.7 billion, down 14.4% from a year earlier………………………………………..Full Article: Source

The Take-Off of the Nigeria Sovereign Wealth Fund

Posted on 30 May 2016 by VRS  |  Email |Print

Professor Gordon L. Clark and Dr. Ashby Monk are two researchers known for their extensive work on Sovereign Wealth Funds (SWFs). Regular publications arising from their distilling research initiatives on different aspects/issues affecting sovereign wealth funds in all parts of the world get posted on the Oxford SWF Project website.
Policy makers, practitioners and other researchers regularly enrich their knowledge and understanding on the SWF subject matter by visiting this website from time to time. Under recent publications on this website is a paper jointly authored by Professor Gordon L. Clark and Dr. Ashby Monk and published with the link titled; Modernity, Institutional Innovation and the Adoption of Sovereign Wealth Funds in the Gulf States………………………………………..Full Article: Source

Key questions raised by the $2 trillion Saudi wealth fund plan

Posted on 27 May 2016 by VRS  |  Email |Print

Saudi Arabia is planning to expand its sovereign wealth fund into the world’s largest. The Public Investment Fund could eventually control more than $2 trillion, according to Deputy Crown Prince Mohammed bin Salman, making it big enough to buy the world’s four largest publicly traded companies.
The fund is at the center of efforts to diversify revenue from oil under an economic transformation plan known as Vision 2030. The 84-page Vision blueprint includes plans to restructure the country’s finances, administration and reshape oil giant Saudi Aramco into an industrial and energy conglomerate………………………………………..Full Article: Source

Sovereign Wealth Funds Investing In Infrastructure

Posted on 20 May 2016 by VRS  |  Email |Print

Using extracts from the 2016 Preqin Sovereign Wealth Fund Review and data from Preqin’s Infrastructure Online, Joe McGee and Selina Sy examine these investors’ plans and preferences concerning infrastructure investments.
Sovereign wealth funds continue to1 capture attention as a result of their ever growing assets under management (AUM) and corresponding influence on global financial markets. Despite market volatility and the ongoing decline in commodity prices, which has reduced the capital available to some sovereign wealth funds, AUM managed by these investors reached $6.51tn in March 2016. This is over double the aggregate assets held in 2008 ($3.07tn), the year Preqin launched its first Sovereign Wealth Fund Review………………………………………..Full Article: Source

Abu Dhabi to ease budget spending cuts, says ratings agency Moody’s

Posted on 17 May 2016 by VRS  |  Email |Print

Fitch estimates that the Abu Dhabi government sold about $27 billion of sovereign wealth fund assets to help it finance its deficit in 2015. It can finance its deficit by drawing down on the assets of the Abu Dhabi Investment Authority, the sovereign wealth fund that manages between $475bn and $773bn in assets, according to different estimates.
“Abu Dhabi is probably one of the best placed economies in the Gulf to cope with low oil prices,” said Jason Tuvey, an emerging markets economist at Capital Economics. “They’ve got enormous savings in their sovereign wealth funds and debt levels are low, so they can afford to prolong the adjustment for an extended period of time.” Abu Dhabi sovereign wealth funds hold assets under management equivalent to between three and four times the annual economic output of the emirate………………………………………..Full Article: Source

The State of Russian Sovereign Wealth Fund Assets

Posted on 13 May 2016 by VRS  |  Email |Print

Much has changed since a decade ago. Russia’s fast growing spurt in oil is now in a different phase, as the price of crude oil is impacting the country. Russia’s Ministry of Economic Development in a 2017-2019 study forecasts the amount of assets in both the Russian Reserve Fund and National Welfare Fund will fall to 2 trillion roubles by 2020.
When Western relations with Russia were stronger, a number of private equity executives were engaged with the RDIF, including TPG’s David Bonderman, Apollo’s Leon Black, Permia’s Björklund and Blackstone Group’s Stephen Schwarzman………………………………………..Full Article: Source

The Middle East’s 10 Biggest Sovereign Wealth Funds (For Now)

Posted on 12 May 2016 by VRS  |  Email |Print

Saudi Arabia’s plan to create a $2 trillion sovereign wealth fund has set an ambitious new standard for state-run investment vehicles. These funds are an increasingly common sight around the world, but particularly in the Middle East, where oil-rich governments like to squirrel away money when oil prices are high in preparation for leaner times.
The Sovereign Wealth Fund Institute (SWF Institute) lists 79 funds in its rankings, with 20 of them in the Middle East and North Africa. Now that the price of a barrel of oil has slumped, these stores of wealth are coming into play, helping governments to deal with their budget deficits so they can still provide all the services their citizens have come to expect. But which ones have the most money?……………………………………….Full Article: Source

Preqin says SWFs are adopting ‘safer’ real estate strategies

Posted on 06 May 2016 by VRS  |  Email |Print

According to the latest data from Preqin, core real estate is most targeted strategy, while distressed opportunities see large decline In its latest review, Preqin finds that sovereign wealth funds investing in real estate in 2016 have moved away from higher risk investment strategies, and are increasingly targeting strategies with a lower risk profile.
Core real estate is now the most utilised strategy, employed by 72% of sovereign wealth funds, up from 57% in 2015. Similarly, core plus investments are now sought by 44% of sovereign wealth funds, up from 39% a year ago, says the data provider. Some 85% of sovereign wealth funds seek direct investment in real estate, the most attractive route to market………………………………………..Full Article: Source

Here Are 4 Ways to Invest Like the Pros at Sovereign-Wealth Funds

Posted on 05 May 2016 by VRS  |  Email |Print

In the world of investing, there are the small players, big players and then the biggest players of all: sovereign-wealth funds, which are state-owned investment funds. The world’s SWFs manage trillions of dollars’ worth of investments on behalf of the governments that raised these funds through different forms of taxes, most frequently, by taxing natural-resource extraction.
The funds are usually set aside for when they are needed but in the meantime are allocated in a wide array of investments. The largest SWF is Norway’s, Norway Government Pension Fund Global, which as of last June controlled $873 billion, according to the Sovereign Wealth Fund Institute………………………………………..Full Article: Source

Major Gulf Sovereign Fund Retools Fund Manager Strategy

Posted on 03 May 2016 by VRS  |  Email |Print

The oil crisis (for those who produce oil) has shed some light on the practices of Gulf sovereign investors. Sizable fund redemptions by SWFs occurred in 2015. For example, Northern Trust faced major outflows from several sovereign wealth fund clients, between March 2015 and March 2016.
Plain-vanilla mandates are being challenged, can they be effectively replicated by using investment factors? According to SWFI Compass, an RFP and opportunity intelligence tracker, increasingly all types of public investors are asking for specialist mandates in credit, real estate and real assets………………………………………..Full Article: Source

Saudi PIF, SAMA Foreign Holdings among largest sovereign wealth funds

Posted on 03 May 2016 by VRS  |  Email |Print

Saudi Arabia’s Public Investment Fund (PIF) is now the world’s 13th largest sovereign wealth fund with assets amounting to $160 billion by the end April, the Sovereign Wealth Fund Institute (SWFI) said in its latest report.
The PIF secured its ranking after gaining $154.7 billion since the end of last year. The kingdom’s SAMA Foreign Holdings fund, which placed fourth on the list, saw its assets fall by $36.3 billion over the same period to $632.3 billion. Meanwhile, the Abu Dhabi Investment Authority (ADIA) ranked second on the list with $773 billion worth of assets………………………………………..Full Article: Source

Global Growth to Influence Wealth Fund Withdrawals, ADS Says

Posted on 02 May 2016 by VRS  |  Email |Print

Global economic growth will determine whether sovereign wealth funds withdraw further funds from global markets, according to ADS Holding LLC Chairman Mahmood Al Mahmood. Funds are “there to act as a tool for governments when they’re needed,” Al Mahmood, who is also a board member at Abu Dhabi sovereign investment fund Mubadala Development Co., said.
“Is this the end of it? It depends how the economy is whether they’ll continue operating the same way they did in the past.” Sovereign funds from Qatar to the United Arab Emirates and Russia, which amassed about $7 trillion of assets as oil soared higher than $100 a barrel, have been liquidating investments after a more than 70 percent slump in crude since 2014………………………………………..Full Article: Source

Sovereign Wealth Funds Uplift Muslim World with Fajr Capital

Posted on 02 May 2016 by VRS  |  Email |Print

Fajr - Arabic for “dawn,” to symbolize hope - has a modest $700 million in capital, but its founding shareholders have much deeper pockets. Three sovereign wealth funds - the $111 billion Abu Dhabi Investment Council, Brunei Investment Agency, the sovereign fund of the oil-rich Southeast Asian sultanate, and Malaysia’s $35 billion Khazanah Nasional - joined forces with Mohammed Alsubeaei & Sons Investments Co. (MASIC) to create and nurture the young firm.
Fajr is a union of institutions that have high credibility and share the same values, says Ihsan Bafakih, CEO of MASIC. According to a 2015 report published by Spain’s ESADE business school, the 36 sovereign wealth funds based in Muslim countries account for 46 percent of the estimated $7 trillion in global sovereign wealth assets………………………………………..Full Article: Source

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