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Sovereign Wealth Funds Briefing 30.Oct 2008

Posted on 30 October 2008 by VRS |  Email |Print

From Contrarianprofits.com: The plummeting price of oil could cause another source of capital to dry up: the Sovereign Wealth Funds (SWFs) of the Persian Gulf. This could be another blow for global credit markets.

These oil-rich funds fueled with petrodollars invested trillions over the past few years, notably with high-profile infusions of billions in CitiGroup, Carlyle Group, Merrill Lynch and the Nasdaq Stock Market. Now with oil down more than 50% from near $150 a barrel in July, the Persian Gulf is beginning to suffer from its own credit squeeze…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Gulfnews.com: Nearly $1.5 trillion, or half of the world’s sovereign wealth funds are owned by the six GCC states. Yet small investors in Kuwait are protesting, while others in the countries are either counting losses or fuming amid widespread concerns of a severe impact of the global financial meltdown.

This leads to the obvious question - are the Gulf states investing enough in their own economies?….. Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Reuters: Singapore sovereign wealth fund Temasek Holdings has agreed to a further investment of up to 12 billion rupees (94 million pounds) in Pakistan’s NIB Bank via a rights issue, NIB said.

Temasek, already NIB’s largest shareholder with 63.15 percent, will participate in the Pakistani bank’s 12 billion rupee rights issue and subscribe for shares not taken up by minority holders…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Adnkronos.com: A Qatari minister said that Arab sovereign wealth funds have only a commercial aim and are not interested in hostile takeover bids of European companies at knock-down prices.

“The sovereign wealth funds of the Gulf countries do not intend to take advantage of the financial crisis in order to run after European companies and buy them at low prices,” Qatar’s Minister of Commerce Fahad bin Jasim al-Thani told Adnkronos International (AKI). “The sovereign wealth funds have only a commercial aim. Their objective is to diversify investments in order to have various sources of income, aside from oil. …… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From CFR: To date, the CIC hasn’t exactly distinguished itself with its investment acumen. Its investments in Blackstone and Morgan Stanley are underwater. Its Blackstone shares are down something like 75%.

Even its “safe” investments haven’t been safe: it put money in the Reserve Primary Fund — the money market fund that famously broke the buck…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Guardian: Kuwait passed a law to guarantee bank deposits on Wednesday even as Gulf central banks offered reassurances about the health of their banking systems, saying there was no need to provide more assistance to lenders.

The government-sponsored bill came after the central bank stepped in to save the country’s fifth-biggest lender, Gulf Bank , this week following steep derivatives losses.
The news sent shockwaves through Gulf bourses, sending stocks into a tailspin and investor confidence to new lows…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Gulf-times.com: Abu Dhabi, which holds almost 8% of the world’s oil reserves, is likely to help Dubai pay its debts if the second-largest country in the United Arab Emirates is unable to meet its obligations, a Citigroup official said.

“Dubai is highly leveraged, everybody knows that, but they are the second emirate in the U.A.E. and Abu Dhabi will not let Dubai go down,” said Citigroup’s managing director of Equities Middle East & North Africa Kaveh Samie in an interview in London late Tuesday. Kuwait, Abu Dhabi, Qatar and Saudi Arabia are the “safest” Gulf economies to invest in because they are the “main beneficiaries of the high oil price”, Samie said…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Globeinvestor.com: The Canada Pension Plan Investment Board (CPPIB) has set aside at least $1.4-billion to bargain-hunt during the credit crunch for top-quality office and retail properties in the United States and the United Kingdom.

In addition to this capital, which will be invested in opportunistic real estate funds run by managers including The Blackstone Group and Morgan Stanley, the CPPIB is also searching for direct investments, said Graeme Eadie, senior vice-president of real estate investments at the CPPIB. ….. Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From KBS: The government is reviewing offering a state guarantee of foreign currency deposits, as it does for deposits made in the Korean currency.

An official of the Financial Services Commission said that the suggestion is under consideration as a measure to encourage people to keep their foreign currency in domestic banks. But government agencies are cautious about implementing the measure, since it could be interpreted as a sign of weakness in the nation’s foreign reserves. ….. Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Travelwires.com: Singita Game Reserves has successfully concluded an agreement that sees Dubai World acquire 50% of Singita’s interest in their Kruger National Park concession, incorporating two Relais & Chateaux lodges - Singita Lebombo and Singita Sweni.

The new ownership structure will not give rise to any change in the management and marketing of the operations, which will continue to be contracted to Singita’s management company. Luke Bailes, CEO of Singita says: ‘Working with one of the world’s leading global investment companies bodes well for Singita Game Reserves…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From ADN: Starting this month, 50 percent of the royalties generated from state mineral leases issued after Dec. 1, 1979, will be placed in the Permanent Fund. That’s an increase from the 25 percent that has been transferred since 2003.

The increase is due to the automatic repeal of a 2003 law that temporarily cut the rate at 25 percent, the state Department of Revenue said. Under the state constitutional amendment in 1976 that created the Permanent Fund, an oil wealth savings account now worth about $28 billion, at least 25 percent of all mineral lease rentals, royalties, royalty sale proceeds and federal mineral revenue sharing payments and bonuses received by the state shall be placed in a permanent fund, the department said…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From Washingtonpost.com: The Federal Reserve said today it will lend money for the first time to central banks in several emerging nations, as it tries to prevent a global shortage of dollars.

The central bank said it is establishing “swap lines” of up to $30 billion each with the central banks of Brazil, Singapore, Mexico and South Korea. This will allow those banks to pump cash into their respective financial systems…… Full Article: Source

Posted on 30 October 2008 by VRS |  Email |Print

From FT: Sovereign wealth funds in the oil-rich Gulf states are actively seeking investments in the troubled US economy, Robert Kimmitt, the deputy US treasury secretary, said.

The region’s economic powerhouses had seemed reluctant to divert much of their estimated $2,000bn (€1,600bn, £1,300bn) portfolio into the US economy, worrying that the economic crisis has further to go. Gulf money has been instrumental in previous attempts to shore up the balance sheets of major Wall Street names…… Full Article: Source

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