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Sovereign Wealth Funds Briefing - Category | Asset Allocation more

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

XPO to raise $3.26 billion with an eye to more deals - sources

Posted on 01 June 2015 by VRS  |  Email |Print

XPO Logistics Inc will raise $3.26 billion through new equity and debt, partly to fund acquisitions, according to people familiar with the matter, just one month after a $3.53 billion deal to buy France’s Norbert Dentressangle SA.
A consortium of 15 investors that include Singapore’s sovereign wealth fund and Canadian public pension funds Ontario Teachers’ Pension Plan and Public Sector Pension Investment Board have agreed to provide $1.26 billion to XPO by acquiring 28 million of its shares, equivalent to 21 percent of its common stock, at $45 per share, the people said on Sunday………………………………….Full Article: Source

Temasek-Backed InnoVen Seeks Asia Expansion to Fill Lending Gap

Posted on 28 May 2015 by VRS  |  Email |Print

InnoVen Capital India, controlled by Temasek Holdings Pte, is seeking to expand its venture debt business across Asia as banks in the region shy away from lending to early-stage companies.
The seven-year-old Mumbai firm plans to use its underwriting model honed in India to expand into Southeast Asia this year and later to China, Chief Executive Officer Ajay Hattangdi said in a May 26 interview. InnoVen has provided debt to over 50 venture capital-backed companies including Snapdeal.com, the Indian web marketplace backed by billionaire Masayoshi Son’s SoftBank Corp……………………………………Full Article: Source

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

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