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Khazanah debuts ethical Islamic bonds with annual sales planned

Posted on 19 May 2015 by VRS  |  Email |Print

Malaysia’s state-owned sovereign wealth fund is about to test appetite for the nation’s first socially responsible Islamic bonds and plans to issue such debt annually. Khazanah Nasional Bhd will start marketing as much as RM150 million (US$42 million) of the seven-year sukuk today, Chief Financial Officer Mohd Izani Ghani said in a May 14 interview in Kuala Lumpur.
The offering will fund 20 schools in Malaysia, he said, adding that future sale options may include healthcare and affordable housing. The world’s biggest Shariah-compliant debt market is setting a precedent for Socially Responsible Investment sukuk after pioneering Islamic finance 30 years ago………………………………………..Full Article: Source

Khazanah to test market with Malaysia’s first ethical sukuk

Posted on 19 May 2015 by VRS  |  Email |Print

Malaysia’s sovereign fund Khazanah Nasional on Monday launched the country’s first sustainable and responsible sukuk (SRI) with a RM1 billion bond programme. Khazanah will price the first issuance next week: a seven-year RM100 million sukuk that will fund the rollout of 20 new government schools this year.
It hopes to raise at least RM150 million annually by issuing sukuk from the 25-year programme, which has a preliminary credit rating of AAA by Kuala-Lumpur based RAM ratings………………………………………..Full Article: Source

Abu Dhabi-Backed Falcon Sees ‘Years of Gains’ for Europe Stocks

Posted on 07 May 2015 by VRS  |  Email |Print

Falcon Private Bank, the wealth manager owned by an Abu Dhabi sovereign wealth fund, says European stocks have “years of gains” to come as the region rolls out its stimulus plan, while the U.S. bull run is almost over.
Markets in the euro zone may take a “short pause” before the influx of liquidity from the European Central Bank’s quantitative easing program prompts increases, David Pinkerton, the Zurich-based chief investment officer for Falcon, said Wednesday in an interview at Bloomberg’s Dubai offices………………………………………..Full Article: Source

Biggest Wealth Fund Joins Bond Bears in Bet Europe Rally Fading

Posted on 30 April 2015 by VRS  |  Email |Print

Norway’s $900 billion sovereign wealth fund is joining Janus Capital’s Bill Gross and Jeffrey Gundlach of Doubleline Capital in betting Europe’s historic bond rally is coming to an end.
Yngve Slyngstad, the manager of the Oslo-based fund which on Wednesday reported a record investment return, said he is weighting a 2.5 trillion-krone ($328 billion) bond portfolio to shorter maturities, meaning it will outperform when rates rise. “As long as interest rates are stable, or falling, we will be lagging the broader markets as we have a shorter maturity in the portfolio,” Slyngstad said in an interview………………………………………..Full Article: Source

Malaysia to have world’s largest syariah pension fund

Posted on 24 April 2015 by VRS  |  Email |Print

Malaysia’s state pension fund will offer a syariah-compliant investment option for its members by 2017, Prime Minister Datuk Seri Najib Razak said. This would create the largest syariah fund of its kind in the world, Najib said at the launch of an investment conference here. He did not specify how big he thought the syariah-compliant standalone fund could be.
Malaysia’s sovereign wealth fund Khazanah Nasional will add to the government efforts by issuing a RM1 billion socially responsible Islamic bond, which has now received regulatory approval, Najib added. The moves could help boost Malaysia’s economy, which has faced weakness due to the slump in oil prices and rising debt………………………………….Full Article: Source

Why NM State Investment Council allocated $1.1 billion for ’smart beta’

Posted on 07 April 2015 by VRS  |  Email |Print

The New Mexico State Investment Council, which manages the state’s $20 billion sovereign wealth fund — otherwise known as a permanent endowment — has allocated $1.1 billion for a new investment strategy known as ” smart beta.”
NMSIC oversees several permanent funds that distribute financial allocations to sectors that include public education, water infrastructure and more. The Land Grant Permanent Fund, for example, annually funnels more than a half-billion dollars into public schools, universities and other institutions; during the 2015 fiscal year, approximately $595 million in benefits will be distributed from the Land Grant Fund………………………………………..Full Article: Source

Social-security fund allowed to invest in local government bonds

Posted on 02 April 2015 by VRS  |  Email |Print

China’s State Council, or cabinet, announced measures on Wednesday to boost returns at the nation’s social-security fund, expanding its investment scope to include local-government bonds and other financial instruments.
The new rules allow the fund to invest up to 20% of its portfolio in local-government debt and corporate bonds, according to a statement on the main government website. Previously, the fund was allowed to invest up to 10% of its portfolio in corporate debt, but not in local-government debt………………………………………..Full Article: Source

No Risk Too Big as Bond Traders Plot Escape From Negative Yields

Posted on 23 March 2015 by VRS  |  Email |Print

In the negative-yield vortex that is the European bond market, investors are discovering just what lengths they’re willing to go to generate returns. Norway’s $870 billion sovereign wealth fund said this month that it added Nigeria and lifted its share of lower-rated company debt to the highest since at least 2006. Allianz SE, Europe’s biggest insurer, is shifting from German bunds to bulk up on mortgages. JPMorgan Asset Management is buying speculative-grade corporate debt to boost returns.
With the European Central Bank’s fight against deflation pushing yields on almost a third of the euro area’s $6.26 trillion of government bonds below zero, even the most risk-averse investors are taking chances on assets and regions that few would have considered just months ago. That’s exposing more clients to the inevitable trade-off that comes with the lure of higher returns: the likelihood of deeper losses………………………………………..Full Article: Source

1MDB support letter as good as guarantee, says DAP

Posted on 18 March 2015 by VRS  |  Email |Print

Putrajaya’s letter of support to debt-laden 1Malaysia Development Bhd is tantamount to a guarantee on the loans taken by the fund, the DAP said today.Party publicity chief Tony Pua said although all ministers had insisted that the loans guaranteed by the federal government amounted to only RM5.8 billion, the actual figure was more than RM16 billion of the sovereign wealth fund’s RM42 billion debt.
Speaking at the Parliament lobby today, Pua said 1MDB’s RM16 billion debt should be added on to the government’s contingent liability. He said that previously Deputy Finance Minister Datuk Ahmad Maslan had repeatedly denied that the government has issued a letter of support for 1MDB via its subsidiary 1MDB Global Investment Limited to raise a US$3 billion bond on November 6 last year………………………………………..Full Article: Source

Norway’s oil fund to sell European bonds, buy real estate in 2015

Posted on 16 March 2015 by VRS  |  Email |Print

Norway’s $860 billion sovereign wealth fund will continue to sell down its European government debt portfolio and may spend all of its new cash inflow in 2015 on real estate investments, Chief Executive Yngve Slyngstad said on Friday.
“We are not enthusiastic about investing in European government bonds,” Slyngstad told Reuters on the sidelines of a press conference. “This year it may we be that we are using more than the inflow in real estate investment, so as such, yes, we’ll be selling other assets… European government bonds.”……………………………………….Full Article: Source

Biggest Wealth Fund Loads Up on Spanish Bonds as Part of QE Bet

Posted on 16 March 2015 by VRS  |  Email |Print

Norway’s $860 billion sovereign wealth fund, the world’s biggest, has bought up Spanish government bonds in anticipation that European Central Bank debt purchases will drive up their value.
Holdings of Spanish government bonds rose by 67 percent to 46.7 billion kroner ($5.7 billion) in 2014, Norges Bank Investment Management said in its annual report on Friday. NBIM lowered its exposure to Spanish covered bonds after their valuation benefited from ECB purchases, Chief Executive Officer Yngve Slyngstad said………………………………………..Full Article: Source

Norway’s Sovereign Wealth Fund reducing investments in Turkish bond market

Posted on 16 March 2015 by VRS  |  Email |Print

Norway’s Sovereign Wealth Fund, the largest in the world at USD 890 billion, has announced that it will be reducing its investments in the Turkish bond market, resulting in a TRY 77 million decline in bonds. Despite Turkey having a coefficient of 1 according to the Barclays Capital Aggregate Bond Index, the Sovereign Wealth Fund noted that it had reduced Turkey’s position to 0.5. This means its position on Turkish Lira bonds will be reduced by exactly half.
AK Investment’s Gökhan Şen told BusinessH/T that he calculates this decision will result in a TRY 77 million decline in Turkish Lira bonds. Foreigners have reduced their positions on Turkish bonds by USD 1.2 billion since the start of the new year………………………………………..Full Article: Source

1Malaysia Devt Bhd undertaking IPO to overcome cash flow problems

Posted on 13 March 2015 by VRS  |  Email |Print

1Malaysia Development Bhd (1MDB) is in the process of undertaking the initial public offering (IPO) to inject capital flow into the sovereign fund to overcome its cash flow problems. Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah, said this short-term measure would be launched in June or July.
“The IPO is important. It is needed to restructure borrowing,” he said. Ahmad Husni said this in reply to a supplementary question by Mohd Fasiah Mohd Fakeh (BN-Sabak Bernam) on the financial position of 1MDB at Dewan Rakyat here yesterday………………………………………..Full Article: Source

Malaysia’s 1MDB to be dismantled under debt plan: sources

Posted on 06 March 2015 by VRS  |  Email |Print

Malaysia’s indebted and controversy-ridden state investor 1MDB will be left as a skeletal structure and possibly dissolved under a debt repayment plan in which most of its assets will be sold, sources with direct knowledge of the matter said.
The power and property fund, a pet project of Prime Minister Najib Razak with assets worth US$14 billion, was hit by losses last year and nearly defaulted on a loan payment. The near-miss drove down the ringgit currency and Malaysian government bonds and prompted calls from opposition leaders to make the fund’s accounts more transparent………………………………………..Full Article: Source

HKBN IPO priced at top of range as GIC, CVC, Carlyle raise nearly S$1b

Posted on 06 March 2015 by VRS  |  Email |Print

US private equity firm CVC Capital Partners, Singapore’s sovereign wealth fund GIC and a unit of Carlyle Group raised a combined HK$5.5 billion (S$966 million) after Hong Kong’s second-largest broadband Internet provider HKBN priced its initial public offering at the top end of the marketed range, people familiar with the deal said today (March 5).
The IPO was priced at HK$9 per share, at the top of the HK$8 to HK$9 indicated range, said the sources, who couldn’t be named because details of the sale of 645 million shares weren’t yet public. Two other investors raised about HK$310 million in the listing, from which HKBN - previously known as Hong Kong Broadband Network - itself received no funds. No new shares were offered in the sale, worth HK$5.8 billion in total………………………………………..Full Article: Source

CVC, GIC, Carlyle raise $750 mln after HKBN prices IPO at top of range

Posted on 05 March 2015 by VRS  |  Email |Print

Private equity firm CVC Capital Partners, a unit of Carlyle Group LP and Singapore’s sovereign wealth fund GIC raised a combined $750 million after Hong Kong’s second-largest broadband Internet provider, HKBN, priced its initial public offering at the top of expectations, IFR reported on Thursday citing people familiar with the deal.
The IPO was priced at HK$9 per share, at the top of the HK$8 to HK$9 marketing range, according to IFR, a Thomson Reuters publication. CVC, GIC and Carlyle’s AlpInvest Partners were among HKBN shareholders offering 645 million existing shares in the IPO. HKBN, previously known as Hong Kong Broadband Network, raised no funds from the offering………………………………………..Full Article: Source

Khazanah to float RM1b sukuk to fund schools

Posted on 02 March 2015 by VRS  |  Email |Print

Khazanah, Malaysia’s sovereign wealth fund, yesterday announced plans to issue a sukuk (Islamic bond) worth up to RM1 billion to help fund schools. The fund’s managing director Tan Sri Azman Mokhtar, speaking to Reuters on the sidelines of an Islamic finance function here, said the planned “social impact sukuk” is awaiting regulatory approval from Malaysian financial regulators.
Approval, said Azman, could come within two months. Khazanah, which holds a portfolio worth about RM112 billion, said the move is aimed at opening funding for education to a broad pool of investors rather than financing it out of its own reserves………………………………………..Full Article: Source

Malaysia sovereign fund plans $279 mln “social impact” sukuk

Posted on 27 February 2015 by VRS  |  Email |Print

Malaysia’s $40 billion sovereign wealth fund Khazanah Nasional plans to issue a sukuk worth up to one billion ringgit ($279.17 million) to help fund schools, its managing director said on Thursday.
Speaking to Reuters on the sidelines of an Islamic finance event in London, the fund’s head Azman Mokhtar said the planned “social impact sukuk” is awaiting regulatory approval from Malaysian financial regulators. The move is aimed at opening funding for education to a broad pool of investors rather than financing it out of its own reserves, he added………………………………………..Full Article: Source

GIC among shareholders in HKBN IPO that could raise S$1b

Posted on 24 February 2015 by VRS  |  Email |Print

HKBN, Hong Kong’s second-largest broadband Internet provider, will launch its initial public offering today, with shareholders including GIC looking to raise up to HK$5.8 billion (S$1 billion), Thomson Reuters’ IFR reported. At the top of its indicative range, the IPO would be the second-largest in the Asia-Pacific region this year, after the US$1.13 billion (S$1.5 billion) raised by Jasmine International’s Internet infrastructure fund in Bangkok earlier this month.
GIC, private equity firm CVC Capital Partners, HKBN’s management and other shareholders will offer 645 million existing shares in an indicative range of HK$8 to HK$9 each, IFR said, citing sources familiar with the plans. HKBN, previously known as Hong Kong Broadband Network, will raise no funds from the IPO, with all proceeds going to GIC and other selling shareholders………………………………………..Full Article: Source

Malaysia’s 1MDB Says May Sell Land Assets, Equity in Projects

Posted on 20 February 2015 by VRS  |  Email |Print

Malaysia’s 1MDB said it may sell assets and its real estate projects will sell land development rights and could enter into profit-sharing joint ventures, as the state fund seeks to cut down on its massive debt burden. Announcing the completion of a strategic review that begun last month, the fund also said it will meet maturing debt by refinancing from “best available sources” or repay it through the sale of land development rights.
1MDB has racked up debt of 41.9 billion ringgit ($11.6 billion) in a major spending spree to build up a portfolio of power plants. It confirmed that it plans to list its power assets this year. 1MDB’s debt woes have weighed on the ringgit in recent months. The ringgit was up 0.2 percent against the dollar after the announcement………………………………………..Full Article: Source

NSSF to buy bonds

Posted on 13 February 2015 by VRS  |  Email |Print

The National Social Security Fund (NSSF) has unveiled plans to buy bonds of high growth potential start-ups on the Growth Enterprise Market Segment (GEMS). The fund intends to buy well-designed bonds on the alternative market and later sell the same to new investors through the stock exchange; the move is expected to bolster the segment.
Richard Byarugaba, the NSSF managing director, told the media at Workers House that discussions have been held with the Capital Markets Authority (CMA) and the Uganda Securities Exchange (USE) on the prospects of the bonds. He revealed that separate discussions have been held with senior offi cials of Bank of Uganda about increasing the variety of investment instruments such as infrastructure bonds, like is currently available in Kenya and Rwanda………………………………………..Full Article: Source

1MDB’s debt burden sparks fears of fallout for Malaysian economy

Posted on 05 February 2015 by VRS  |  Email |Print

When Ananda Krishnan, Malaysia’s second-richest man, sold a collection of power plants to a little-known fund called 1MDB in 2009, few outside Southeast Asia’s third-largest economy paid any attention. But reports that the 76-year-old tycoon, whose fortune is estimated by Forbes at $9.8bn, is close to getting his hands back on some of those assets have catapulted the now heavily indebted state-run 1MDB - or 1Malaysia Development Berhad - into the spotlight.
Set up six years ago, 1MDB has no less a figure than the country’s prime minister, Najib Razak, chairing its advisory board, while Goldman Sachs, the Wall Street bank, has twice arranged multibillion-dollar debt issues for it……………………………………….Full Article: Source

Resurgent banking market sees Irish SWF shift to junior debt, equity funding

Posted on 04 February 2015 by VRS  |  Email |Print

A resurgent banking sector has seen the Ireland Strategic Investment Fund (ISIF) reassess its role as debtor to Irish companies, with rising competition from lenders leading the sovereign wealth fund to consider other roles.
Donal Murphy, the €7.1bn fund’s head of infrastructure and credit finance, told IPE the funding gap that existed after the financial crisis was often no longer there, replaced by a “wall of liquidity coming from bank debt back into Ireland”. “There are plenty of scenarios where there is a very competitive bank market with a large number of banks seeking roles on individual transactions and individual deals,” he said………………………………………..Full Article: Source

1MDB Said to Seek Loan Extension Before $3 Billion Energy IPO

Posted on 28 January 2015 by VRS  |  Email |Print

1Malaysia Development Bhd. is planning to seek another one-month extension on a 2 billion ringgit ($554 million) loan to give it more time to sell a stake in its energy unit, two people familiar with the matter said.
The state-owned investment company needs more time to repay the debt as it’s still in discussions with billionaire T. Ananda Krishnan, Malaysia’s second-richest person, said the people who asked not to be named as the process is private………………………………………..Full Article: Source

Mumtalakat won’t sell assets to plug shortfall

Posted on 26 January 2015 by VRS  |  Email |Print

Bahraini sovereign fund Mumtalakat will not sell any assets or change its investment strategy in response to a likely oil price-driven shortfall in the state budget, it said. The fund holds stakes in Bahraini companies including Alba, Gulf Air and Batelco.
Mumtalakat is fully state-owned, but unlike a sovereign wealth fund it receives no surplus cash from the government, investing money generated from its own returns. State inflows to sovereign funds are in doubt this year across the Gulf region………………………………………..Full Article: Source

Private equity: The definition of an opaque asset class

Posted on 26 January 2015 by VRS  |  Email |Print

At a private equity conference years ago, I sat beside a couple of trustees from a small pension fund. Nice men, highly educated and intelligent, and wanting to do their best for their members, but utterly clueless about investments. Going straight to direct investment is not always wise, as the $72bn Korea Investment Corporation found. The sovereign wealth fund said last year it would change its strategy after direct investing produced “disappointingly lower returns” than investing through funds.
“Who could know more of Korean projects than KIC? Who could be better versed in what is happening in Singapore than GIC or Temasek?” asked KIC’s chairman and chief executive, referring to two Singaporean sovereign funds………………………………………..Full Article: Source

1MDB IPO: A chance to get it right

Posted on 19 January 2015 by VRS  |  Email |Print

Just when it looked like state-backed 1MDB was finally ready to put its energy assets on the market for Malaysia’s biggest IPO in years, the listing has come up against another delay. That hardly inspires confidence in the sovereign wealth fund. But with a new president in place, there is now a chance to set things straight — not only for the country’s capital markets but also for the sovereign itself.
There has been no end to the controversies surrounding Malaysia’s sovereign wealth fund 1MDB. For a start, it was facing a backlash from local politicians about billions of dollars it had stored in the Cayman Islands………………………………………..Full Article: Source

GIC, Ironbridge plan IPO of Australian car-lease firm FleetPartners

Posted on 16 January 2015 by VRS  |  Email |Print

Singapore sovereign wealth fund GIC and Australian private equity firm Ironbridge Capital are planning an initial public offering of FleetPartners Ltd in a deal that would value the car leasing company at about US$615 million, a source said.
The IPO was expected as early as April, the person, who had direct knowledge of the matter, told Reuters on Wednesday. It was not clear yet how much of the company was up for sale but the source said between 50 and 80 per cent is likely to be on the block. He did not want to be named as the transaction was confidential………………………………………..Full Article: Source

Malaysia’s sovereign wealth fund earns over $1B from Alibaba IPO

Posted on 16 January 2015 by VRS  |  Email |Print

Alibaba’s IPO late last year earned many happy investors a fortune – Yahoo, for example, raked in a massive US$9.4 billion after selling off its shares. Yesterday, Malaysia’s sovereign wealth fund Khazanah revealed that it too made a tidy profit of more than US$1 billion in selling a part of its Alibaba holdings, according to the Financial Times.
In its financial report for 2014, Khazanah disclosed that it invested US$400 million in Alibaba in the last two years, giving it a stake of 0.6 percent. It continues to hold an undisclosed amount of shares after selling some post-IPO………………………………………..Full Article: Source

GIC, Ironbridge plan IPO of Australian car-lease firm FleetPartners-Reuters

Posted on 15 January 2015 by VRS  |  Email |Print

Singapore sovereign wealth fund GIC and Australian private equity firm Ironbridge Capital are planning an initial public offering of FleetPartners Ltd in a deal that would value the car leasing company at about $615 million, a source said.
The IPO was expected as early as April, the person, who had direct knowledge of the matter, told Reuters on Wednesday. It was not clear yet how much of the company was up for sale but the source said between 50 and 80 percent is likely to be on the block. He did not want to be named as the transaction was confidential………………………………………..Full Article: Source

1MDB Says It’s ‘Responsible’ Borrower Amid Debt Concerns

Posted on 07 January 2015 by VRS  |  Email |Print

1Malaysia Development Bhd., the country’s state investment company, defended its credentials as a borrower after a newspaper reported it failed to repay a loan of more than $500 million last month.
“As far as the banking sector and the credit sector is concerned, we are responsible borrowers” and the company has never defaulted, Arul Kanda, who was named president of 1MDB yesterday, said in an interview. “We need to manage the use of our cash in the most efficient way for the company.”……………………………………….Full Article: Source

IPO setback for 1MDB? Chief exec replaced

Posted on 06 January 2015 by VRS  |  Email |Print

1Malaysia Development Bhd (1MDB) will be welcoming its third chief executive in a space of just over five years since it was established, as the government-sponsored investment fund struggles to complete the submission of the listing of its energy unit.
Malaysian-born, Dubai-based banker, Arul Kanda Kandasamy (pic), will replace 1MDB chief executive Mohd Hazem Abdul Rahman, who was appointed to the post in August 2012. 1MDB chairman Tan Sri Lodin Wok Kamaruddin announced the appointment of Arul Kanda as president and group executive director of 1MDB with immediate effect and described the change as “part of a transition plan”………………………………………..Full Article: Source

Malaysia’s 1MDB delays $3.2 billion Islamic bond to 2015: Sources

Posted on 12 December 2014 by VRS  |  Email |Print

Malaysia’s sovereign wealth fund, 1Malaysia Development Bhd, has postponed the sale of up to 8.4 billion ringgit (S$3.2 billion) of Islamic bonds to 2015, according to two people familiar with the matter.
The delay comes as the state fund, known as 1MDB, is seeking an extension of up to two months on the construction of a $3.2 billion power plant project it won with partner Mitsui & Co Ltd in February. “The process (bond issuance) will resume as soon as new timing is confirmed, subject to the Energy Commission’s approval, of course,” one of the people briefed on the matter said………………………………………..Full Article: Source

Sukuk record scuppered as 1MDB delays 2014 sale

Posted on 10 December 2014 by VRS  |  Email |Print

Global Islamic bond sales look set to miss out on a record year after Malaysia’s sovereign wealth fund postponed what would have been 2014’s biggest offering. The top underwriter is also cautious over the coming year.
Issuance to date is US$2.1bil (RM4.2bil) shy of the unprecedented US$46.8bil (RM162.8bil) in 2012 and more than last year’s US$43.1bil (RM150bil) total, data compiled by Bloomberg show. 1Malaysia Development Bhd (1MDB) put off a plan to sell the equivalent of US$2.4bil (RM8.3bil) of sukuk until the first half of 2015, said two people with knowledge of the deal………………………………………..Full Article: Source

Qatar, Kuwait Wealth Funds Invest in Dubai Parks IPO

Posted on 09 December 2014 by VRS  |  Email |Print

Sovereign wealth funds from Qatar and Kuwait are among institutional investors that bought shares in the initial public offering of Dubai’s new theme park developer and operator.
Kuwait Investment Authority, Qatar Investment Authority, Gulf family offices and global institutional investors helped Dubai Parks & Resorts raise 2.53 billion dirhams ($690 million), the company said in a statement today. The institutional tranche was oversubscribed 65 times, attracting about 100 billion dirhams, while local investors made 10.9 billion dirhams of offers, according to the statement………………………………………..Full Article: Source

1MDB plans January meetings with cornerstones for US$3b energy IPO

Posted on 04 December 2014 by VRS  |  Email |Print

Heavily indebted 1Malaysia Development Bhd (1MDB) is planning meetings in January with potential cornerstone investors for the US$3 billion IPO of its power business 1MDB Energy, said sources familiar with the matter. The initial public offering is aimed at helping the state investor, known as 1MDB, reduce a debt burden that exceeds US$11.
billion. Plans for the sale had been delayed several times, bankers say, due to a longer-than-expected due diligence process and debt refinancing negotiations. Raising US$3 billion could place the 1MDB Energy IPO as Southeast Asia’s fifth-biggest listing ever, according to Thomson Reuters data………………………………………..Full Article: Source

Norway’s $870 Billion Fund Closer to Expanding Asset Pool

Posted on 03 December 2014 by VRS  |  Email |Print

Norway moved a step closer to deciding whether its sovereign wealth fund, the world’s largest, will be allowed to broaden its investments to include infrastructure as part of a strategy to increase returns.
The government will ask the $870 billion fund’s Strategy Council to assess whether the Government Pension Fund Global — the fund’s official name — should invest in unlisted infrastructure, the Finance Ministry said today. It will also look into raising the 5 percent cap on real estate investments………………………………………..Full Article: Source

Khazanah considers releasing Islamic bonds to finance business expansions

Posted on 26 November 2014 by VRS  |  Email |Print

Malaysia’s state-owned sovereign wealth fund is giving the government’s green financing initiative a boost with a plan to sell the nation’s first sukuk under socially responsible investment guidelines.
Khazanah Nasional Bhd. is considering issuing a benchmark sized ringgit-denominated Islamic bond to finance expansion in its education or renewable energy businesses, Chief Financial Officer Mohd Izani Ghani said in November 20 interview in Kuala Lumpur. The notes will probably be issued in the second half of 2015, he said………………………………..Full Article: Source

Bahrain’s Mumtalakat Said to Raise $600 Million From Sukuk

Posted on 19 November 2014 by VRS  |  Email |Print

Bahrain Mumtalakat Holding Co., the Gulf country’s sovereign wealth fund, raised $600 million from the sale of Islamic bonds, according to a person familiar with the deal, as it seeks funds to refinance debt.
The seven-year sukuk will be priced to yield 205 basis points, or 2.05 percentage points, over the benchmark midswap rate, said the person, asking not to be identified because the information is private. The price Mumtalakat paid fell from initial guidance of about 237.5 basis points above midswaps as demand increased, the person said………………………………….Full Article: Source

Bahraini fund Mumtalakat launches $600 mln seven-year sukuk

Posted on 19 November 2014 by VRS  |  Email |Print

Bahrain sovereign fund Mumtalakat has launched a $600 million seven-year sukuk at the tight end of its previously-marketed price range, with the sale set to complete later on Tuesday, a document from lead managers said.
The sukuk pricing was last revised to 210 basis points, plus or minus 5 bps, over midswaps, after being marketed initially at 220 bps over the same benchmark guidance. BNP Paribas, Deutsche Bank, Mitsubishi UFJ Financial Group and Standard Chartered are arrangers to the deal………………………………….Full Article: Source

1MDB Criticized by Lawmakers Before Sukuk Sale: Islamic Finance

Posted on 19 November 2014 by VRS  |  Email |Print

Malaysia’s opposition lawmakers are criticizing rising debt at the sovereign wealth fund as the company plans to sell the nation’s biggest sukuk of 2014. 1Malaysia Development Bhd.’s power unit is seeking to raise 8.4 billion ringgit ($2.5 billion) before year-end, which will increase its outstanding debt to $15 billion, data compiled by Bloomberg show.
The fund, which counts Prime Minister Najib Razak as chairman of its advisory board, attracted criticism last year over fees and profits made by Goldman Sachs Group Inc. for arranging a $3 billion bond. 1MDB is financing projects under Najib’s $444 billion development program, which has pushed Malaysia’s borrowings to 52.8 percent of gross domestic product, near the self-imposed 55 percent limit…………………………………Full Article: Source

1MDB abusing proceeds from US$3 billion bond, says DAP lawmaker

Posted on 18 November 2014 by VRS  |  Email |Print

In another twist to the 1Malaysia Development Bhd (1MDB) saga, a federal lawmaker has claimed that the state sovereign fund is diverting part of the proceeds of the US$3 billion (RM9.6 billion) loan raised by its subsidiary to fund operating expenses and pay off its burgeoning debts.
This, said Tony Pua (DAP - Petaling Jaya Utara) clearly showed that 1MDB was facing difficulties in balancing its cash flow. The sovereign fund’s wholly owned subsidiary, 1MDB Global Investments Limited, had issued a bond to raise US$3 billion in March last year………………………………..Full Article: Source

Bahrain’s Mumtalakat sets initial price guidance for up-to-$600 mln sukuk

Posted on 18 November 2014 by VRS  |  Email |Print

Bahrain sovereign fund Mumtalakat has opened order books after setting initial price guidance for an up-to-$600 million seven-year Islamic bond offering, a document from lead managers said.
The firm has set initial price thoughts in the area of 237.5 basis points over midswaps for the sukuk, which is expected to price on Tuesday, the document showed. A series of meetings with fixed income investors is set to conclude on Monday in London, having been hosted in Asia and the Middle East last week, arranged by BNP Paribas, Deutsche Bank, Mitsubishi UFJ Financial Group and Standard Chartered………………………………..Full Article: Source

Equities to stay dominant in SWF portfolios: Cerulli

Posted on 11 November 2014 by VRS  |  Email |Print

While Asia’s biggest institutions are increasingly investing in alternative assets, sovereign wealth funds’ allocations continue to be dominated by equities, and that situation is likely to continue, said research house Cerulli Associates.
But a shared penchant for equities has not resulted in uniform performance, the firm found in a new report, in which it focuses on Asia’s four largest SWFs: Singapore’s GIC and Temasek, Korea Investment Corporation (KIC), and CIC International, the unit of China Investment Corporation that invests offshore………………………………………..Full Article: Source

Mumtalakat Hires Banks For Potential Dollar Sukuk Issue

Posted on 11 November 2014 by VRS  |  Email |Print

Bahraini sovereign fund Mumtalakat (BBB from S&P/Fitch) has hired BNP Paribas, Deutsche Bank, MUFG and StanChart to arrange a series of fixed income investor meetings starting on Thursday, Nov. 13.
A Reg S U.S. dollar-denominated sukuk transaction may follow subject to market conditions. Roadshows start in Kuala Lumpur on Thursday before moving to Singapore on Friday, Abu Dhabi and Dubai on Sunday before closing in London on Monday, Nov. 17………………………………………..Full Article: Source

MP presses Putrajaya for answers as 1MBD, banker contradict each other on fees

Posted on 04 November 2014 by VRS  |  Email |Print

Putrajaya must clarify questions surrounding fees paid for 1 Malaysia Development Bhd’s (1MDB) fundraising after the sovereign wealth fund and investment banker Goldman Sachs gave conflicting explanations, a DAP lawmaker said.
Petaling Jaya Utara MP Tony Pua said this was necessary given the billion-ringgit scale involving the allegations on the fees paid, which he previously said was a magnitude more than those usually charged. “The answers provided by Goldman Sachs and 1MDB are in direct conflict with one another. “The conflict is even more frightening given the multi-billion ringgit scale of the exercise,” Pua said………………………………………..Full Article: Source

Bahrain fund Mumtalakat sets up $1 bln bond, sukuk programmes

Posted on 04 November 2014 by VRS  |  Email |Print

Bahraini sovereign fund Mumtalakat has set up separate bond and sukuk issuance programmes in the Irish stock exchange to raise as much as $1 billion, to help refinance maturing debt next year.
One of the smaller sovereign wealth funds in the Gulf region, Mumtalakat holds stakes in several firms in the kingdom’s non-oil sector, including Bahrain Telecommunications Co and Aluminium Bahrain………………………………………..Full Article: Source

Bahrain Fund Mumtalakat Sets Up $1bn Bond, Sukuk Programmes

Posted on 03 November 2014 by VRS  |  Email |Print

Bahraini sovereign fund Mumtalakat has set up separate bond and sukuk issuance programmes in the Irish stock exchange to raise as much as $1 billion, to help refinance maturing debt next year.
One of the smaller sovereign wealth funds in the Gulf region, Mumtalakat holds stakes in several firms in the Kingdom’s non-oil sector, including Bahrain Telecommunications Co and Aluminium Bahrain. The multi-currency programmes have been assigned a BBB rating by Fitch ratings, which said proceeds would be used predominantly to refinance upcoming maturities………………………………………..Full Article: Source

ETFs to Play the Largest Wealth Fund’s India Bet

Posted on 31 October 2014 by VRS  |  Email |Print

As the world’s largest wealth fund increases its holdings in India, the average retail investors can also access this emerging market through country-specific exchange traded funds. For example, the PowerShares India Portfolio, iShares MSCI India ET and iShares India 50 ETF all provide access to India’s equities markets.
Norway’s sovereign wealth fund, which holds $860 billion in assets under management, increased holdings “significantly” in India as the recently elected Prime Minister Narendra Modi opens the economy to investments and competition, reports Saleha Mohsin for Bloomberg. The sovereign wealth fund raised its Indian bonds and stock position to 0.9% of its fixed-income and equity portfolio in an attempt to increase its emerging market exposure and generate greater returns………………………………………..Full Article: Source

Malaysia’s 1MDB readies $3bn IPO of power asset

Posted on 31 October 2014 by VRS  |  Email |Print

1Malaysia Development Berhad, a large Malaysian government fund, is paving the way for a $3bn stock market listing of its power assets on the Kuala Lumpur exchange early next year, according to people familiar with the matter.
The planned initial public offering comes amid ongoing scrutiny by opposition politicians in Malaysia of 1MDB, a vast wealth fund formed only five years ago in partnership with interests in Abu Dhabi and Saudi Arabia………………………………………..Full Article: Source

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