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Future Fund buys government bonds as deflation hedge

Posted on 10 February 2016 by VRS  |  Email |Print

The Future Fund has ramped up its holdings of government bonds as a defence against the risk of global deflation, said managing director David Neal as he explained why the sovereign wealth manager has become “relatively cautious” about the future.
Expressing concern about the “diverging paths” of economies around the world, Mr Neal cautioned that doubts about the pace of US Federal Reserve interest rate hikes and their impact on emerging markets posses “certain risks.”……………………………………….Full Article: Source

SOFAZ refuses to transfer its gold reserves into other assets

Posted on 04 February 2016 by VRS  |  Email |Print

Azerbaijan’s state oil fund SOFAZ is not planning to transfer its gold reserves into other assets. SOFAZ buys gold not for the sake of purchase or other speculative purposes but for strategic purposes, the Fund told Report.
The investment strategy of SOFAZ presupposes that up to 5 percent of total cost of investment portfolio may be invested in gold. The amount of SOFAZ gold assets was 30,175 kg or 970,146 troy ounces by late 2015. The Fund further noted that sale of the gold reserves or its replacement with other assets is not in the agenda of SOFAZ………………………………………..Full Article: Source

Sovereign wealth funds drive turbulent trading

Posted on 02 February 2016 by VRS  |  Email |Print

Asset managers have blamed outflows from sovereign wealth funds for one of the worst starts to the year for markets. The collapse in the price of oil resulted in state-backed investment vehicles becoming “forced sellers”. The year began with a sharp drop in equity markets. UK and US stocks fell almost 10 per cent in the first few weeks of 2016 and emerging markets were hit even harder.
Philippe Ferreira, a director at Lyxor Asset Management, the €116bn fund house, said sovereign wealth funds have been driving the turbulent trading conditions. “We know the sovereign wealth funds are under pressure to sell and that is contributing to the market pressure we are seeing,” he said. “Sovereign wealth funds have become forced sellers,” added Guy Monson, chief investment officer of Sarasin & Partners, a UK boutique investment manager………………………………………..Full Article: Source

Sovereign Funds Vs. Asset Managers: The Big Picture

Posted on 29 January 2016 by VRS  |  Email |Print

A number of asset managers who focus on institutional investors such as commodity-based sovereign wealth funds have been ravaged with redemptions. The rapid descent of oil prices flummoxed wealth fund chiefs. In response to the oil glut, the money management spigot for investment managers running listed equity strategies has slowed.
Furthermore, Middle Eastern sovereign funds have been dumping some hedge funds (some shuttered operations), while Canadian asset giants shift more focus toward private credit, real estate and infrastructure investments. However, for some cash-rich sovereign wealth funds like the Abu Dhabi Investment Authority (ADIA), the sustained low price of oil has a negligible effect on their real estate investment activities………………………………………..Full Article: Source

The sovereign wealth ruling class

Posted on 25 January 2016 by VRS  |  Email |Print

It’s always good to have deep pockets, but few institutional investors carry checkbooks backed by entire nations. Yet point to one of New York City’s recent big-ticket real estate deals and there’s a good chance a sovereign wealth fund was one of the buyers.
Through the first 11 months of 2015, sovereign wealth funds spent more than $22.6 billion on real estate in the United States, up from about $9.8 billion in 2014, according to research firm Real Capital Analytics. “If you need billions of dollars for a project, where are you going to go?” said Savills Studley executive managing director Woody Heller, who heads the brokerage’s capital markets group………………………………………..Full Article: Source

Khazanah hits road for US dollar sukuk

Posted on 15 January 2016 by VRS  |  Email |Print

Khazanah Nasional Bhd has mandated Barclays, CIMB, Morgan Stanley and UBS to arrange a series of investor meetings for a US dollar sukuk offering. The roadshow will take place in Dubai on Sunday, Hong Kong on Monday, Singapore on Tuesday and London on Wednesday.
The Reg S offering will be unrated and issued off the Multi-currency Islamic Securities Issuance Programme established by Danga Capital Bhd. Danga Capital is a special purpose financing vehicle initiated by Khazanah, Malaysia’s sovereign wealth fund………………………………………..Full Article: Source

Tender of 10-year Government Bonds on 20 January 2016

Posted on 12 January 2016 by VRS  |  Email |Print

The Hong Kong Monetary Authority (HKMA), as representative of the Hong Kong Special Administrative Region Government (HKSAR Government), announces today (Monday) that a tender of 10-year Government Bonds (Bonds) under the Institutional Bond Issuance Programme will be held on Wednesday, 20 January 2016, for settlement on Thursday, 21 January 2016.
A total of HK$1.8 billion 10-year Bonds will be tendered. The Bonds will mature on 21 January 2026 and will carry interest at the rate of 1.68% per annum payable semi-annually in arrears. Under the Institutional Bond Issuance Programme, tender is open only to Recognized Dealers which are appointed as Primary Dealers………………………………………..Full Article: Source

The Overblown Threat to Money Managers

Posted on 05 January 2016 by VRS  |  Email |Print

The sound of sovereign wealth funds sucking money back home is whistling through the asset management industry. But the direst forecasts for asset managers may be overblown. Sovereign funds have ballooned, from $3.3 trillion in 2007 to $7.2 trillion by the middle of 2015, according to the Sovereign Wealth Fund Institute, a research firm.
At the end of 2014, SWFs — many of them from commodity-rich countries — had $1.9 trillion in equities, $900 billion in fixed income and short-term liquid assets and $400 billion in alternative investments, including real estate, hedge funds and private equity, according to a Bloomberg News report last month based on Moody’s research………………………………………..Full Article: Source

Kuwait sovereign fund postpones sale of subsidiary via IPO

Posted on 04 January 2016 by VRS  |  Email |Print

Kuwait’s sovereign wealth fund is delaying the sale of its holding in Kuwait Investment company (KIC) through an initial public offering due to market conditions, it said in a bourse statement on Thursday.
The Kuwait Investment Authority (KIA), the region’s oldest state fund with an estimated $500 billion (Dh1.83 trillion) in assets, owns 76 per cent of KIC. The KIA’s divestiture in KIC was first announced in late October 2014 and initially slated for the first half of this year, according to a report by Moody’s Investors Service………………………………………..Full Article: Source

IMF Says Ukraine Bond Owned by Russia Is Official Sovereign Debt

Posted on 17 December 2015 by VRS  |  Email |Print

The International Monetary Fund’s executive board ruled that a bond sold by Ukraine to Russia should be considered official sovereign debt, putting pressure on Ukrainian officials to start restructuring talks with their Russian counterparts.
The bond was acquired by and is held by Russia’s National Wealth Fund, an agency acting on behalf of the Russian government, according to a staff paper considered by the board. Russia bought a $3 billion bond from the government of former Ukrainian President Viktor Yanukovych in 2013………………………………………..Full Article: Source

Italian state lender to set up equity fund for family businesses

Posted on 17 December 2015 by VRS  |  Email |Print

State-owned Italian bank Cassa Depositi e Prestiti (CDP) is to set up a private equity fund to help family businesses, but a family business expert questions to what degree it will achieve its aim of helping them go public.
CDP will act as an anchor investor and invite foreign investors and sovereign wealth funds to buy shares in the companies. Professor Alfredo De Massis, director of the Centre for Family Business at Lancaster University says the fund will help business go public, but some might be reluctant to initial public offerings (IPO) due to cultural bias………………………………………..Full Article: Source

Norway oil fund dumps bonds, clearing path to quarterly profit

Posted on 10 December 2015 by VRS  |  Email |Print

The world’s biggest sovereign wealth fund says it has recovered from the losses it suffered in the second and third quarters thanks to a strategy of dumping bonds and buying up stocks and real estate. The fund “has been reducing dramatically” its bond holdings over the past five years, Yngve Slyngstad, its chief executive officer, said.
There is still a “challenging investment environment” ahead of next week’s Federal Reserve decision. But the fund has nonetheless “got everything we lost in the third quarter back in the fourth quarter — so it’s going to be another positive year,” he said………………………………………..Full Article: Source

Alaska SWF Backs New SSgA Smart Beta Funds

Posted on 10 December 2015 by VRS  |  Email |Print

Increasingly, sovereign wealth funds and pensions are embracing the usage of factor-based investing or smart beta. State Street Global Advisors (SSgA) has US$ 81 billion in assets under management when it comes to smart beta offerings. SSgA developed new exchange-traded funds (ETF) with input from the Alaska Permanent Fund Corporation (APFC).
The APFC has been contemplating smart beta strategies for well over a year, according to SWFI Compass - an opportunity tracking service. In return, the AFPC is investing US$ 1 billion across the three new smart beta ETFs. The three ETFs are broken out by yield, momentum and low volatility………………………………………..Full Article: Source

Norway Oil Fund Dumps Bonds, Clearing Path to Quarterly Profit

Posted on 09 December 2015 by VRS  |  Email |Print

The world’s biggest sovereign wealth fund says it has recovered from the losses it suffered in the second and third quarters thanks to a strategy of dumping bonds and buying up stocks and real estate. The fund “has been reducing dramatically” its bond holdings over the past five years, Yngve Slyngstad, its chief executive officer, said in an interview in Paris on Tuesday.
There is still a “challenging investment environment” ahead of next week’s Federal Reserve decision. But the fund has nonetheless “got everything we lost in the third quarter back in the fourth quarter — so it’s going to be another positive year,” he said………………………………………..Full Article: Source

GMR Infra inks Rs 2,000-crore bond deal with Kuwait Investment

Posted on 08 December 2015 by VRS  |  Email |Print

GMR Infrastructure has inked a foreign currency convertible bond private-placement deal with Kuwait Investment Authority (KIA) for $300 million (approximately Rs 2,000 crore). “Kuwait Investment Authority today agreed to subscribe to a sixty-year long Foreign Currency Convertible Bond (FCCB) due 2075 to be issued by GMR, the flagship company of the GMR Group,” GMR Infrastructure said in its filing to the BSE on Friday.
Kuwait Investment Authority is one of the largest and oldest sovereign wealth fund of the world. “This is the largest bilateral investment of Kuwait Investment Authority in India. This investment shows confidence of sovereign investors in the long-term policies being implemented by the Government of India, particularly in the infrastructure space,” said GMR Group’s Chairman G M Rao in the statement………………………………………..Full Article: Source

1MDB Aims To Resolve Debt Issue, Dewan Told

Posted on 27 November 2015 by VRS  |  Email |Print

1Malaysia Development Bhd (1MDB) aims to resolve its debt and cashflow problem without the government’s financial assistance, said Deputy Finance Minister Datuk Johari Abdul Ghani. He said the sovereign wealth fund implemented its strategic rationalisation plan early this year to resolve its RM42 billion debt.
“If all the strategic plans are implemented quickly and without any hurdles, it would reduce 1MDB’s debt interest charges,” Johari said when replying to Rantau Panjang MP Siti Zailah Mohd Yusoff in Parliament ……………………………………….Full Article: Source

Elite funds prepare for reflation and a bloodbath for bonds

Posted on 26 November 2015 by VRS  |  Email |Print

The Norwegian Pension Fund, the world’s top sovereign wealth fund, is rotating a chunk of its $860bn of assets into property in London, Paris, Berlin, Milan, New York, San Francisco and now Tokyo and East Asia. “Every real estate investment deal we do is funded by sales of government bonds,” says Yngve Slyngstad, the chief executive.
It already owns part of the Quadrant 3 building on Regent Street, and bought the Pollen Estate - along with Saville Row - from the Church Commissioners last year. But this is just a nibble. The fund is eyeing a 15pc weighting in property, an inflation-hedge if ever there was one………………………………………..Full Article: Source

Norway Wealth Fund Backs Push to End Banks’ Dominance Over Bonds

Posted on 23 November 2015 by VRS  |  Email |Print

The world’s largest sovereign investor wants to curtail the big banks’ hold over bond trading. The $860 billion Norwegian sovereign-wealth fund is backing the European Union’s campaign to bring transparency to the bond market and make debt trade more like stocks.
The fund says the current setup — where investors call a bank to get a price — is dysfunctional and should be fixed by forcing the banks to publish their prices. The fund will make reform of Europe’s debt markets one of its priorities, according to Oeyvind Schanke, its chief investment officer for asset strategies. It’s easy to see why………………………………………..Full Article: Source

Kazakhstan plans IPOs for 43 large state firms in 2016-17

Posted on 19 November 2015 by VRS  |  Email |Print

Kazakhstan plans to sell stakes of at least 25 percent in 43 large state-owned companies via initial public offerings (IPOs) in 2016-17, the Samruk-Kazyna sovereign wealth fund said. The government faces a plunge in revenues from oil, Kazakhstan’s main export. President Nursultan Nazarbayev told a government meeting on Wednesday he wanted Kazakh businessmen and companies to take part in the privatisations.
The stakes will be sold on the floor of the oil-rich nation’s financial centre being built in the capital Astana, the fund said. The businesses to go public include oil and gas company KazMunaiGas, uranium company Kazatomprom, railway company Kazakhstan Temir Zholy and mining firm Tau-ken Samruk, it said……………………………………..Full Article: Source

Saudi aims for first foreign bond as soon as next year

Posted on 11 November 2015 by VRS  |  Email |Print

Saudi Arabia aims to start selling bonds in the international market as soon as next year as it seeks new ways to cover a budget deficit caused by low oil prices, banking industry sources said on Tuesday. The sources, who have been discussing the matter with officials in the central bank, the Saudi Arabian Monetary Agency (SAMA), said authorities had not yet finalised the plan but were making progress.
“If it’s going to be January, June or 2017, I’m not sure,” said a senior Gulf banker, declining to be named because of commercial sensitivities. “But it’s something that’s top of their minds.” A Saudi commercial banker said bankers were pitching to both the finance ministry and SAMA………………………………………..Full Article: Source

Norway’s Wealth Fund Targets Major Cities After Bonds Hit Zero

Posted on 09 November 2015 by VRS  |  Email |Print

Relentless monetary easing across the rich world is driving the biggest sovereign wealth fund away from debt markets as it instead targets real estate investments in mega cities. Chief Executive Officer Yngve Slyngstad says the meager returns bonds offer mean the $860 billion wealth fund needs to look elsewhere to meet its 4 percent return target.
At the same time, a study published on Friday by the fund shows there’s an argument for tripling its real estate investment to 15 percent of the total portfolio. Lars Dahl, chief risk officer for real estate at the wealth fund, says the best property to invest in now is to be found in the world’s biggest cities………………………………………..Full Article: Source

Norway’s $860 billion wealth fund selling foreign bonds to buy property - CEO

Posted on 09 November 2015 by VRS  |  Email |Print

Norway’s $860-billion (566.47 billion pounds) sovereign wealth fund is funding all its real estate deals by selling government bonds from its portfolio of foreign fixed income assets, its chief executive said on Friday.
“Every real estate investment deal we do is funded by sales of government bonds,” Yngve Slyngstad told a seminar on real estate investments held at the Norwegian central bank………………………………………..Full Article: Source

Old School Asset Managers, Meet New SWFs

Posted on 04 November 2015 by VRS  |  Email |Print

Some of the world’s largest investors, including sovereign wealth funds (SWFs), have brought asset management in house in recent years, putting pressure on external managers’ revenues. However, newly established sovereign wealth funds (SWFs) still require help accessing traditional investment strategies and mainstream asset classes, according to Cerulli Associates.
The company cited Nigeria’s planned trio of SWFs: “It is likely that much of that [work] will need the assistance of external managers,” said Barbara Wall, Europe research director. Saudi Arabia has reportedly begun work on a second wealth fund, while Papua New Guinea, Mexico, Angola, Bangladesh, and Egypt are all at various stages of launching their own SWFs. Wall said such funds could be “lucrative sources of outsourcing mandates in their early years.”……………………………………….Full Article: Source

Jumbo IPO attracts Temasek arm

Posted on 29 October 2015 by VRS  |  Email |Print

Seafood restaurant chain Jumbo Group has attracted an arm of Temasek Holdings and the founder of Asia’s biggest massage-chair maker OSIM as cornerstone investors for its S$40 million initial public offering here.
Jumbo is seeking a listing on the Catalist board, with trading expected to commence on Nov 9, it said today (Oct 28). An offering that size would be the biggest initial share sale this year in Singapore, data compiled by Bloomberg shows. Jumbo is selling 88.2 million new shares at S$0.25 apiece in order to raise capital as it seeks to open at least four new F&B outlets in China and Singapore during the next two years………………………………………..Full Article: Source

Top sovereign funds came in as anchor investors for IndiGo IPO

Posted on 28 October 2015 by VRS  |  Email |Print

Sovereign funds of Norway, Singapore and Kuwait are among the anchor investors who put money in InterGlobe Aviation Ltd, which runs India’s top air carrier IndiGo, on the eve of the firm opening its maiden public issue.
Norway’s Government Pension Fund Global, the world’s largest sovereign wealth fund; Singapore’s GIC, and Kuwait Investment Authority together put in Rs 113 crore ($17 million) as part of the Rs 832 crore that IndiGo raised through anchor investors. GIC and the Norwegian fund are two of the most active sovereign funds in Indian public equities………………………………………..Full Article: Source

Malaysian bonds bounce back as 1MDB fears fade

Posted on 28 October 2015 by VRS  |  Email |Print

Malaysia’s bonds are showing signs of stability, heating up the debate on when to pile back into Asia’s worst-performing debt. Malaysia’ corporate dollar-denominated notes have returned 1.5% this month, paring their losses for the year to 1.7%, the biggest on a JPMorgan Chase & Co index.
The cost of insuring the nation’s sovereign debt has fallen the most in four years in October, while the ringgit has rallied 3.2% after a decline of 20% in the first nine months………………………………………..Full Article: Source

Malaysian bonds bounce back as 1MDB fears fade

Posted on 27 October 2015 by VRS  |  Email |Print

A potential rating cut is still deterring investors, according to Jonathan Lemco, senior sovereign analyst and principal at Vanguard, which runs the world’s biggest bond fund. Fitch Ratings earlier this year pointed at the possibility as Malaysia’s trade balance worsened and amid concerns related to 1Malaysia Development Bhd., a sovereign wealth fund at the center of a political scandal that has prompted street demonstrations calling for Najib’s resignation.
The downgrade threat has since lessened after Fitch changed the outlook for the nation’s credit score to ‘stable’ from ‘negative’ on June 30. Among the reasons were improved fiscal finances and the fact that even the current-account surplus is above the median of nations with a similar A- rating to Malaysia’s, it said………………………………………..Full Article: Source

World’s biggest wealth fund calls for rules to fight ETF risks

Posted on 23 October 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund says there’s a need for new rules to limit the risks spreading from the growth in exchange-traded funds. The $860-billion fund is concerned over the growing impact ETFs have on the underlying securities they are connected to, said Oeyvind Schanke, chief investment officer for allocation strategies at Norges Bank Investment Management, the department in the central bank in Oslo that runs the fund.
A good step has been imposing circuit breakers on exchanges, “but the interaction between ETFs and underlying securities is also important,” he said in an interview after participating at a conference in Qatar. The interaction between futures and the ETFs underlying securities is increasing “so we probably need some set of rules that take care of that inter- connectivity.”……………………………………….Full Article: Source

GIC investment spurs 28% gain in India’s best junk bond

Posted on 23 October 2015 by VRS  |  Email |Print

A bit of AAA-rated endorsement can go a long way for a little-known junk bond issuer. Dollar notes in India’s Greenko Group Plc have gained 28 per cent in 2015 after Singapore sovereign wealth fund GIC agreed to take full control of one of the renewable energy firm’s businesses. It’s the best performing high-yield bond in India in a Bank of America Merrill Lynch index of dollar notes that’s lost 1.3 per cent this year.
Greenko isn’t the first Asian company to benefit from Singapore’s intervention. Holders of Olam International’s unrated notes also profited after state investment arm Temasek Holdings Pte made a takeover offer for the commodity trader once attacked by Muddy Waters LLC………………………………………..Full Article: Source

REITs: Are Big Backers Like Sovereign Wealth Funds Good Or Bad?

Posted on 15 October 2015 by VRS  |  Email |Print

Some big REIT deals have included well-heeled financial partners like pensions and sovereign wealth funds. That sounds like a good thing. But maybe it’s just allowing more deals to get done at higher cap rates.
The real estate investment trust, or REIT, sector has had a rough year so far share price wise. That said, operationally things appear to be going well for most REITs. One issue that’s popped up more than once, however, is the high price of acquisitions. And the trend toward partnering up with sovereign wealth funds and pensions could be a part of the problem……………………………………….Full Article: Source

Kuwait sovereign wealth fund may sell assets to cover deficit

Posted on 12 October 2015 by VRS  |  Email |Print

Kuwait’s sovereign wealth fund, one of the world’s largest, is considering selling assets to cover a state budget deficit caused by low oil prices, the country’s Al Anba newspaper reported on Sunday, quoting unnamed sources. The Kuwait Investment Authority (KIA), which is estimated to have more than $500 billion of assets, is studying whether to liquidate assets that generate annual returns of below 9 percent, the newspaper said.
The KIA’s money is invested across the world, from the United States to Europe to China, in various asset classes including bonds, equities and real estate. The newspaper did not specify which asset classes might be sold………………………………………..Full Article: Source

Abu Dhabi said to explore asset sales to offset oil slump

Posted on 08 October 2015 by VRS  |  Email |Print

Abu Dhabi is reviewing its largest state-owned companies as the slump in crude oil pressures the emirate’s finances, four people with knowledge of the matter said. Abu Dhabi National Energy Co. and International Petroleum Investment Co. are in talks with banks on options including strategic partnerships, share sales and asset disposals, the people said, asking not to be identified because talks are private.
Mubadala Development Co., an investment fund, is considering further divestments after selling most of the assets in its joint venture with General Electric Co., according to the people. Abu Dhabi, in addition to the three state-owned companies, could also tap sovereign wealth fund the Abu Dhabi Investment Authority to help support its finances. ADIA ranks second behind Norway as the largest in the world at $773 billion, according to the Sovereign Wealth Fund institute………………………………………..Full Article: Source

Indebtedness is hurting Glencore - what must Ivan Glasenberg do to ensure it survives?

Posted on 05 October 2015 by VRS  |  Email |Print

The Telegraph has learnt that Glasenberg sought the backing of the Qatari sovereign wealth fund before last month unveiling the hastily drawn up scheme to cut $10.2bn (£6.7bn) from the company’s gargantuan $29.5bn debt pile.
The South African mining mogul – who has been chief executive since 2002 – believed it was necessary to “bullet proof” Glencore’s balance sheet in the event that the already sharp downturn in commodities prices deepened further. Representatives for the secretive Persian Gulf sovereign wealth fund declined to comment on its investment in Glencore, or the nature of any discussions that may have taken place with Glasenberg………………………………………..Full Article: Source

Central Huijin Investment to issue 30 bln yuan bond on Friday

Posted on 07 September 2015 by VRS  |  Email |Print

State-owned Chinese investment company Central Huijin Investment Ltd will issue 30 billion yuan ($4.72 billion) in onshore renminbi bonds on Friday, according to securities filings. It was not immediately clear how Central Huijin, an investment unit of sovereign wealth fund China Investment Corp, plans to spend the proceeds.
The issuance will have three- and five-year tranches of 13 billion yuan each and a 10-year tranche of 4 billion, the company said in filings on the China Central Depository & Clearing Co Ltd website on Sunday………………………………………..Full Article: Source

Singapore’s GIC comes as anchor investor in Syngene

Posted on 29 July 2015 by VRS  |  Email |Print

Singapore’s GIC, one of the most active sovereign wealth funds in the country, is among the anchor investors which have together invested Rs 150 core in Syngene International Ltd, the research and development subsidiary of Indian biopharmaceutical major Biocon Ltd, as part of an initial public offer (IPO) of the company.
Syngene allocated 6 million equity shares at a price of Rs 250 a piece, the upper end of the IPO price band of Rs 240-250 a share, to around a dozen anchor investors. GIC put in Rs 25 crore while others such as funds managed by Goldman Sachs, Morgan Stanley and Deutsche Bank besides other foreign portfolio investors and a few domestic mutual funds invested the balance Rs 125 crore………………………………………..Full Article: Source

CICC Plans $1 Billion Hong Kong IPO

Posted on 14 July 2015 by VRS  |  Email |Print

China International Capital Corp. is planning to raise US$1 billion in an initial public offering in Hong Kong as early as October, people familiar with the situation said, offering shareholders KKR & Co. and TPG Capital the chance to exit their investments despite turmoil in Chinese stocks.
Central Huijin Investment Ltd., the domestic investment arm of China’s sovereign-wealth fund, is the largest shareholder in CICC with a 43.35% stake. Singapore’s GIC holds 16.35%, while TPG Capital owns 10.3% and KKR holds 10%, according to its 2014 annual report………………………………………..Full Article: Source

Saudi Arabia issues first sovereign bonds since 2007, more to come

Posted on 13 July 2015 by VRS  |  Email |Print

Saudi Arabia has issued its first sovereign bonds since 2007 to cover a budget deficit created by low oil prices, launching a series of debt sales that could reshape its financial markets. So far Riyadh has mainly been running down its financial reserves to cover the deficit; Mubarak said the government had withdrawn 244 billion riyals from reserves in 2015.
This has cut the foreign assets held by the central bank, which is the kingdom’s sovereign wealth fund. Its net foreign assets — mostly U.S. dollar bank deposits and bonds — fell to $672 billion in May. The start of Saudi bond sales means pressure for the reserves to fall may now decrease………………………………………..Full Article: Source

Chinese sovereign wealth fund unit vows to buy more ETFs

Posted on 09 July 2015 by VRS  |  Email |Print

Central Huijin Investment Ltd, a unit of China’s $747 billion sovereign wealth fund, promised on Wednesday it would continue to buy more exchange-traded funds in the battered Chinese market and that it would not sell any Chinese shares that it owns.
The remarks by Central Huijin, a unit of China Investment Corp, echo comments from other Chinese government bodies, such as the Finance Ministry, that they would support the Chinese stock market, which has slumped a third in the past month………………………………………..Full Article: Source

Temasek Zones in on Biotech, Consumer Stocks to Broaden Assets

Posted on 09 July 2015 by VRS  |  Email |Print

Temasek Holdings Pte is shaking up its asset mix with a push into biotechnology and consumer companies that stand to benefit from aging populations and increasing disposable incomes.
Singapore’s state-investment firm singled out life sciences and agriculture as well as consumer goods among the top three industries it allocated money to in the fiscal year ended March 31, helping its portfolio value reach a record. It added assets in U.S. pharmaceutical firm Gilead Sciences Inc, Indian drugmaker Intas Pharmaceuticals Ltd, and health and beauty retailer A.S. Watson during that period………………………………………..Full Article: Source

China’s biggest ETF sees record trading after Beijing unveils rescue plan

Posted on 07 July 2015 by VRS  |  Email |Print

China’s biggest exchange-traded fund (ETF) jumped more than 6 percent on Monday in record turnover, in the clearest sign yet that money from Chinese brokerages, mutual funds and sovereign wealth funds could be flowing into blue chips as part of a rescue package unveiled over the weekend.
The China 50 ETF, which buys into shares of the 50 biggest companies listed in Shanghai, registered turnover of 24.9 billion yuan ($4.01 billion), more than double the previous session. The huge money inflows into the China 50 ETF, which has heavy exposure to financial and energy heavyweights, anchored investor sentiment in Monday’s volatile trading session, and fuelled speculation that Beijing’s “stability fund” was at work………………………………………..Full Article: Source

KIC’s chairman sets course for endowment-like asset allocation

Posted on 03 July 2015 by VRS  |  Email |Print

Korea Investment Corp., the Seoul-based sovereign wealth fund, should follow the path blazed by U.S. university endowments in allocating 50% or more of its portfolio to alternative investments, Chairman Hongchul “Hank” Ahn said Wednesday.
At a celebration marking the 10th anniversary of KIC’s founding, Mr. Ahn — in a speech obtained by Pensions & Investments — said KIC’s more immediate goal is to boost its alternatives allocation to 15% of assets by the end of 2015 from 8% the previous year. Ahn said the KIC has $86 billion in assets, a modest advance from $84.7 billion at the end of 2014………………………………………..Full Article: Source

Kuwait may issue bonds to finance deficit -finance minister

Posted on 03 July 2015 by VRS  |  Email |Print

Kuwait is considering issuing bonds among various options to finance a budget deficit created by low oil prices, Finance Minister Anas al-Saleh said on Thursday.
In addition to issuing bonds, Kuwait could run down assets in its sovereign wealth fund to cover its deficit, as Saudi Arabia has been doing. The Kuwaiti fund holds $548 billion of assets, estimates the Sovereign Wealth Fund Institute, which tracks the industry……………………………………….Full Article: Source

1MDB: Price paid for energy assets based on ‘long-term view’

Posted on 24 June 2015 by VRS  |  Email |Print

1Malaysia Development Berhad (1MDB) debunked allegations made recently in the Wall Street Journal (WSJ) on its 2012 purchase of a power asset from Genting Group, saying the allegedly inflated price paid had not been driven by political considerations.
Instead, 1MDB insisted that like all its other asset acquisitions, the deal with Genting Group was based on a long-term view as well as advice received from independent valuers and the market conditions at the time………………………………………..Full Article: Source

Norway Fund Likes Short Bonds as Volatility Grows

Posted on 19 June 2015 by VRS  |  Email |Print

Norway’s $890 billion sovereign wealth fund, the world’s biggest, is sticking to short bond maturities as markets are increasingly gripped by volatility. The decision is designed to guard against sudden price swings that are migrating from currency markets back to bond markets, Yngve Slyngstad, chief executive officer of Norges Bank Investment Management, which runs the fund, said in an interview in Oslo on Thursday.
“It seems that the volatility that had moved to the currency market has basically come back to the bond market again,” he said. “We have a shorter duration in our portfolio than what’s in the broader markets, so we are prepared for volatility in the bond market.”……………………………………….Full Article: Source

Qatar’s sovereign fund to set asset allocation targets

Posted on 16 June 2015 by VRS  |  Email |Print

Qatar Investment Authority, one of the world’s most aggressive sovereign wealth funds, will set asset allocation targets for the first time and restructure internal decision-making, sources say, in response to a drop in oil prices that has crimped available funds as competition for assets grows.
In a cryptic reference on QIA’s website, a tab saying “QIA Review — Coming Soon” leads to a page which does not yet exist. The sources, who all either work in Qatar or for foreign institutions which work with the QIA, said the review process was currently ongoing. A spokesman for the QIA, which is estimated by industry tracker the Sovereign Wealth Center to have $304 billion of assets, declined to comment………………………………………..Full Article: Source

Sovereign investors want larger exposure to Chinese yuan: Invesco

Posted on 09 June 2015 by VRS  |  Email |Print

Central banks have a growing appetite for risk, wanting more exposure to the Chinese yuan - a view that is also adopted by sovereign wealth funds around the world, a new survey has found. While less than 1 per cent of central bank portfolios were invested in renminbi, 43 per cent of them were interested in gaining more exposure to the currency, an annual soverign asset management study said.
Thirty-five per cent of global sovereign wealth funds reported that they were seeking renminbi exposure. The study by Invesco, released Monday, interviewed 59 sovereign investors across the globe, with assets totaling US$7.09 trillion (S$9.6 trillion). Individual investors were not named but the report included a sample from Singapore………………………………………..Full Article: Source

Sovereign wealth funds likely to lower home-market bond holdings

Posted on 09 June 2015 by VRS  |  Email |Print

Bond markets across the globe look set to lose further favor with sovereign wealth fund investors as a net 47% say they expect to decrease their home-market bond exposures. The third annual report by Invesco (IVZ) about the SWF market, covering $7.1 trillion in assets from 59 investors, found that trend against home-market bonds had increased from a net 38% planning such a shift in the 2014 report.
A propensity for cash was marked, however, with only a net 17% of respondents set to shift from cash, vs. a net 25% in 2014. At the other end of the investor views was infrastructure, with a net 50% expecting to increase allocation to home-market infrastructure, vs. a net 33% in 2014. Global infrastructure is set to increase as well, with a net 63% expecting to shift allocations into the asset class, compared with a net 53% in 2014………………………………………..Full Article: Source

Yuan Market Access Lags Sovereign Investor Demand, Invesco Says

Posted on 08 June 2015 by VRS  |  Email |Print

Sovereign investors’ access to China’s capital market is lagging behind demand, according to a survey. Some 43 percent of central banks and 35 percent of state investors surveyed in the Invesco Global Sovereign Asset Management Study 2015 said they are looking to invest in yuan assets. So far, only 30 percent of the monetary authorities and 10 percent of the sovereign funds have quotas to invest in the onshore market, according to the survey results released Monday.
Invesco interviewed 59 investors that oversee $7.09 trillion of assets, including central banks, sovereign wealth funds and pension funds. Of the entities surveyed, 15 had more than $100 billion of assets under management, according to the study, which didn’t name the investors………………………………………..Full Article: Source

M’sia’s ethical sukuk adds to market width but depth elusive

Posted on 05 June 2015 by VRS  |  Email |Print

Malaysia’s efforts to create a market for ethical Islamic bonds (sukuk) are the latest in a series of government-led initiatives to develop Islamic finance, but further expansion will require a greater buy-in from a sometimes reluctant private sector.
Last month, sovereign wealth fund Khazanah Nasional Bhd (Khazanah) launched the country’s first sustainable and responsible investment (SRI) sukuk, nearly two years after the format was first announced by the government. “Until now, nobody has done it. If we don’t take this challenge, then I don’t think anyone would be doing it,” Khazanah’s chief financial officer Mohd Izani Ghani said in a phone interview. “We have done many firsts before and it is always challenging,” said Izani. ……………………………………….Full Article: Source

Abu Dhabi Investment Authority bolsters internally managed capabilities in 2014

Posted on 03 June 2015 by VRS  |  Email |Print

Abu Dhabi Investment Authority cut the percentage of assets managed by external money managers to 65% from 75% a year earlier, said its 2014 annual report. The move to reduce externally managed assets by the sovereign wealth fund reflected its “efforts over recent years to strengthen the organization’s in-house investment and analytical expertise,” said Hamed bin Zayed Al Nahyan, managing director, in the review. Further details weren’t available.
ADIA does not disclose its assets, but it is estimated by the Sovereign Wealth Fund Institute to have $773 billion. The sovereign wealth fund said about 55% of its assets are invested in index-replicating strategies, steady from 2013………………………………………..Full Article: Source

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