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Sovereign Wealth Funds Briefing - Archive | February, 2015

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

PAC wants AG to audit 1MDB immediately

Posted on 27 February 2015 by VRS  |  Email |Print

The Public Accounts Committee (PAC) wants the Auditor General’s Department to immediately carry out an audit of the government-owned 1MDB’s deals before it calls up the company.
PAC chairman Datuk Nur Jazlan Mohamed said the immediate audit should be of the source of the RM2 billion used to settle 1MDB’s loans with local banks, the RM3 billion injection of government funds into the debt-laden company, its dealings with PetroSaudi International (PSI), and whether the money parked in Cayman Islands has been brought back………………………………………..Full Article: Source

Temasek talks up board action after StanChart shake-up

Posted on 27 February 2015 by VRS  |  Email |Print

Singaporean sovereign fund Temasek underlined the importance of boardroom renewal in a strong statement delivered in response to the radical shake-up at Standard Chartered Bank, which was announced yesterday.
Temasek and Aberdeen Asset Management were reported to be among the emerging market bank’s 10 leading shareholders to have been pushing for a boardroom shake-up as they grew impatient with its share performance………………………………………..Full Article: Source

Standard Chartered Overhaul Gets Temasek Stamp of Approval

Posted on 27 February 2015 by VRS  |  Email |Print

Temasek Holdings Pte. Ltd., the Singapore state investment company, which is the biggest shareholder of Standard Chartered PLC, said Thursday it welcomed Bill Winters as the new chief executive of the emerging markets bank. Mr. Winters, a former co-chief executive of the investment bank at J.P. Morgan Chase, was named as the group chief executive of Standard Chartered, replacing Peter Sands.
Temasek, which owns around 18% in Standard Chartered but doesn’t have a board seat, has expressed frustration with the bank in the past. The state investment firm wasn’t involved in the hiring process at the lender, which is grappling with slowing economies in its core Asian markets that have taken a toll on results………………………………………..Full Article: Source

Singapore Temasek says welcomes StanChart new CEO

Posted on 27 February 2015 by VRS  |  Email |Print

Singapore state investor Temasek Holdings has welcomed the appointment of Bill Winters as Standard Chartered’s new chief executive. “We take this opportunity to welcome Bill Winters as the next CEO of Standard Chartered, to build on and grow its excellent franchise,” Temasek said in a statement.
“He brings with him considerable experience as well as an excellent reputation for building good teams.” “This on-going process for board renewal must continue as the requirements and challenges facing the banking and financial sector across the world have become much more complex and onerous,” Temasek added………………………………………..Full Article: Source

Super Fund confirms Portugal bank legal case

Posted on 27 February 2015 by VRS  |  Email |Print

The New Zealand Superannuation Fund has confirmed this morning that it has filed debt recovery proceedings in the English courts against the Portugese bank Novo Banco. It added that Oak Finance investors “would also shortly be filing public law proceedings in Portugal against the Bank of Portugal, challenging the validity of the Bank’s decision purporting to retransfer the Oak Finance loan, with retroactive effect, from Novo Banco to Banco Espirito Santo.”
Its litigation against the Portuguese central bank, the Bank of Portugal, could end up before the European Court of Justice, said the fund’s chief executive, Adrian Orr………………………………………..Full Article: Source

Angola’s Sovereign Wealth Fund Targets Mine, Timber Investments

Posted on 27 February 2015 by VRS  |  Email |Print

Angola’s $5 billion sovereign wealth fund is seeking investments in mining, timber, health and agriculture as it seeks to diversify its asset base and increase returns. “A large portion of the portfolio is invested in international securities,” Jose Filomeno dos Santos, the fund’s chairman, said in an interview with Bloomberg Television in Cape Town on Thursday.
“We are looking at several opportunities. We wouldn’t want to give away these opportunities by disclosing what they are before they are completely settled,” he said.The fund, which is managed by Zug, Switzerland-based Quantum Global Investment Management Ltd., was established to invest surplus state funds and promote development in Africa’s largest crude oil producer after Nigeria………………………………………..Full Article: Source

Sub-Saharan Africa’s sovereign wealth funds struggle in era of low oil

Posted on 26 February 2015 by VRS  |  Email |Print

For several years, now, Sub-Saharan Africa’s largest oil producing states have been working to create sovereign wealth funds (SWFs). But as oil prices and production decline, such funds may not be able to deliver the benefits they once promised. Since 2007 Angola, Ghana, Nigeria and Mauritania have joined Equatorial Guinea and Gabon in the club of oil-producing countries with SWFs. Currently, four of sub-Saharan Africa’s five largest oil producers maintain some sort of SWF.
Attracted, perhaps, by the success of similar funds in the Middle East and North Africa (MENA) region, sub-Saharan governments are looking to capture oil revenues in rainy day funds in order to smooth fiscal expenditures during suppressed commodity cycles………………………………………..Full Article: Source

Samruk-Kazyna limits forex transactions of its subsidiaries

Posted on 26 February 2015 by VRS  |  Email |Print

Samruk-Kazyna National Wealth Fund of Kazakhstan has instructed its subsidiaries to abstain from making unnecessary foreign currency transactions, Tengrinews reports citing the head of the Fund Umirzak Shukeyev as saying at the press-briefing in the Central Communication Service’s headquarters on February 20.
“To support the Kazakh national currency we have introduced a special corporate standard that prohibits all of our subsidiaries from making unnecessary foreign exchange transactions. Unless there is a specific business need for such a transaction they will have to justify it to us that they really need the foreign currency,” he said………………………………………..Full Article: Source

Australian sovereign wealth funds executive joins Hedge Fund Standards Board

Posted on 26 February 2015 by VRS  |  Email |Print

David George, Head of Debt & Alternatives at the Future Fund, Australia’s sovereign wealth fund, has joined the board of the Hedge Fund Standards Board (HFSB). This appointment emphasises the important role of sovereign wealth funds in promoting better practices in the hedge fund industry, particularly in Asia Pacific.
Dame Amelia Fawcett, Chairman of the HFSB, said: “We are thrilled to welcome our new Australian member to the board. It sends another powerful signal about the global importance of the HFSB mission for the investor community worldwide and particularly in Asia Pacific.” David George said: “I am very pleased to join the Board. The HFSB is an important platform for promoting better industry practice to the benefit of end investors, managers and policymakers. I look forward to working with the other Trustees and to progressing this effort.”……………………………………….Full Article: Source

1MDB: Malaysia’s Banking System and Sovereign Rating at Stake

Posted on 26 February 2015 by VRS  |  Email |Print

The Malaysian ringgit declined by about 12 per cent against the US Dollar between September last year and February 10 this year. On February 18, when 1MDB announced its plan to break up its assets and wind down, the ringgit rose 0.2 per cent. The reason for the positive response was because the move will subsequently reduce its US$11.6 billion (RM42 billion) debt.
1MDB said it would make no new investments or take on new projects and stop borrowing money unnecessarily to refinance current debts. It also said it might sell assets and land development rights and enter into profit sharing joint ventures. A few days earlier, 1MDB settled a RM2 billion (US$550 million) loan it owed local banks, one of which was Maybank. The fund had three times requested and been granted extensions on repayment deadlines for the loan………………………………………..Full Article: Source

Russian Direct Investment Fund Consortium to Acquire Shares in Vladivostok International Airport

Posted on 26 February 2015 by VRS  |  Email |Print

The consortium comprising the Russian Direct Investment Fund (RDIF), a $10 billion fund established to make equity investments into Russian economy, Changi Airports International (CAI), a wholly-owned subsidiary of the world’s leading airport operator Changi Airport Group, and Basic Element, one of Russia’s diversified industrial groups, has been announced as the winner of the tender to acquire shares in Vladivostok International Airport in Russia’s Far East. Each member will hold an equal share in the consortium.
The consortium’s bid was recognised as the best based on the strength of the technical, legal and financial components in the submission. The transaction will be closed after regulatory approvals are received. Vladivostok International Airport is strategically important for the development of the air transportation system in the region due to its geographical location - the crossing of two air routes between the Russian Far East and the Asia Pacific region. (Press Release)

Qatar’s Hassad Food eyes Brazilian sugar, poultry assets

Posted on 26 February 2015 by VRS  |  Email |Print

Hassad Food, the agricultural arm of Qatar’s sovereign wealth fund, said it was looking at possible purchases of Brazilian sugar and poultry assets as structural problems in those industries in the South American country created opportunities.
“We have a lot of stuff in our pipeline and Brazil is definitely part of that, not only sugar but also poultry,” Youssef Hegazy, vice president for business development at Hassad Food, said on Wednesday. Hassad Food, wholly owned by the Qatar Investment Authority, was set up in 2008 to boost the Gulf country’s food security………………………………………..Full Article: Source

Sovereign Wealth Fund Direct Infrastructure Investments, 2003-2014

Posted on 26 February 2015 by VRS  |  Email |Print

Sovereign wealth funds surpassed US$ 7 trillion in assets before the end of 2014. These institutional investors typically have unique liabilities compared to public pensions. Many of the large sovereign wealth funds, funds with over US$ 30 billion in assets, seek long-term investments. When it comes to infrastructure, sovereign wealth funds pursue accommodating investment regimes, low political risk, assurances from government and opportunities to earn stable financial returns.
According to our research, Asia and Europe top the list as the largest recipients of direct infrastructure investment by sovereign wealth funds, followed by Australia and New Zealand. The Americas ranks dead last, even behind Africa. Breaking apart the Americas, South America has few large direct infrastructure investments by sovereign funds, the bulk going to North America………………………………………..Full Article: Source

Iran to spend up to $4.8 billion from sovereign fund on oil development

Posted on 25 February 2015 by VRS  |  Email |Print

Iran will withdraw up to $4.8 billion from its sovereign wealth fund to spend on developing its oil and gas fields next fiscal year under a proposal approved by parliament on Tuesday. The decision to dip into the National Development Fund underlines the heavy financial pressure which Iran faces from low oil prices and international economic sanctions over its disputed nuclear program.
The hard currency allocation, which will supplement other budgetary allocations for the sector, also shows the large sums which Iran needs to spend to modernize its ageing oil fields and crumbling energy infrastructure………………………………………..Full Article: Source

Norway sovereign fund bulks up on real estate

Posted on 25 February 2015 by VRS  |  Email |Print

Norway’s state-run investment fund is becoming one of the world’s biggest landlords at a time when other big commercial property owners are sounding alarms about high prices. The $874 billion Government Pension Fund of Norway, the world’s largest sovereign-wealth fund, last year purchased $7.6 billion worth of property globally, more than any other sovereign fund, according to data from real-estate tracker Real Capital Analytics.
The push is part of a broader strategy to improve returns by taking on more risk. The fund, which has generated an annual return of 3.7% since 1998, aims over time to boost its real-estate holdings to 5% from the current 1.3%………………………………………..Full Article: Source

Sovereign Wealth Fund Investments Hold Steady Amid Oil Shock

Posted on 25 February 2015 by VRS  |  Email |Print

Tired of having its economy whipsawed by big swings in oil prices, Norway in 1996 pened a rainy-day fund to save oil earnings for future generations and cushion the government’s budget from volatility in crude prices. Today the Government Pension Fund Global, as its called, is the world’s largest sovereign wealth fund, with $870 billion in assets.
Its massive size can easily offset the fiscal hit from the recent drop in global oil prices or help prevent “Dutch disease” - the tendency of natural-resource revenues to strengthen local currencies and weaken economic competitiveness- should oil prices rebound………………………………………..Full Article: Source

Poelzer: Saskatchewan needs a resource wealth fund

Posted on 25 February 2015 by VRS  |  Email |Print

To say the rapid drop in oil prices has sent shock waves across the global economy might be the understatement of 2015. Only a few months ago, Canada was touting its aspirations and capacity to become an energy superpower. Today, the federal government and oil-producing provinces that include Saskatchewan and Alberta are urgently dealing with unanticipated budget shortfalls.
In January, Finance Minister Joe Oliver announced that the federal government would postpone its budget by at least two months - a move that is almost without precedent. In Alberta, the engine room of Canada’s emerging energy superpower ambitions, Premier Jim Prentice warned of spending cuts of nine per cent in the upcoming budget………………………………………..Full Article: Source

Temasek participates in Chinese edu site’s $100m Series D round

Posted on 25 February 2015 by VRS  |  Email |Print

Chinese K-12 online learning and teaching platform – 17zuoye.com has raised $100 million in a Series D round of funding that was led by H Capital, the company told local media.
The other investors in the round include Singapore state-fund Temasek Holdings, DST Advisors and Shunwei Capital Partners. The latest financing deal values the startup at $600 million. 17zuoye, which means “let’s do homework together” in Chinese, was launched in 2011 and provides an interactive platform for students to learn their subjects………………………………………..Full Article: Source

Can LNG continue to fuel Papua New Guinea’s economic growth?

Posted on 25 February 2015 by VRS  |  Email |Print

Although in the future, the stabilisation component of the planned sovereign wealth fund should reduce the short-term budgetary impact of a volatile energy market, this will only work as long as the fund is run transparently and in accordance with the Santiago Principles (as opposed to the furtive accountability of many of PNG’s state-owned enterprises).
PNG thus needs to avoid accumulating debt through unsustainable deficits or major further borrowing, particularly for activities which are marginal to government functions, such as equity acquisition (except under the auspices of the sovereign wealth fund)………………………………………..Full Article: Source

Sovereign Wealth Fund Direct Infrastructure Investments, 2013-2014

Posted on 25 February 2015 by VRS  |  Email |Print

Sovereign wealth funds surpassed US$ 7 trillion in assets before the end of 2014. These institutional investors typically have unique liabilities compared to public pensions. Many of the large sovereign wealth funds, funds with over US$ 30 billion in assets, seek long-term investments. When it comes to infrastructure, sovereign wealth funds pursue accommodating investment regimes, low political risk, assurances from government and opportunities to earn stable financial returns.
According to our research, Asia and Europe top the list as the largest recipients of direct infrastructure investment by sovereign wealth funds, followed by Australia and New Zealand. The Americas ranks dead last, even behind Africa. Breaking apart the Americas, South America has few large direct infrastructure investments by sovereign funds, the bulk going to North America………………………………………..Full Article: Source

Sovereign Wealth Funds Investing at Home – Opportunity Fraught with Risk

Posted on 24 February 2015 by VRS  |  Email |Print

Following the recent discoveries of large oil and gas deposits in East Africa, a number of countries in the region are in the process of establishing, or are discussing the creation of, sovereign wealth funds (SWFs) as a means to stabilise the effect of volatile currency inflows and to save for future generations.
Additionally, like several other SWFs established over the last decade, some East African governments are considering a role for the planned funds in economic development, as strategic investors in the national economy. The use of SWFs as a tool for strategic domestic investments opens up a range of new possibilities for deepening undercapitalised domestic financial markets and crowding in private capital to infrastructure in priority sectors such as power and transport………………………………………..Full Article: Source

Sovereign Wealth and Pension Money Flow Into Energy Funds

Posted on 24 February 2015 by VRS  |  Email |Print

Private equity firms are still raising institutional investor capital to target investments in the U.S. energy sector. The Blackstone Group had total commitments of US$ 4.5 billion for its second energy fund, Blackstone Energy Partners II. Some large pensions invested in the fund include: New Jersey Division of Investment and Teacher Retirement System of Texas (TRS).
Meanwhile, smaller funds and platforms are raising capital. Dallas-based PetroCap raised US$ 350 million in PetroCap Partners II, a fund focusing on oil & gas investments in the US$ 20 million to US$ 70 million range. On the debt side, EIG Global Energy Partners and Winter Park-based Triloma Financial Group have formed Triloma EIG Global Energy Fund, an unlisted investment company that will allocate capital to privately originated energy company and project debt………………………………………..Full Article: Source

Kazakhstan’s sovereign wealth fund to optimize its costs

Posted on 24 February 2015 by VRS  |  Email |Print

Kazakhstan’s Sovereign Wealth Fund Samruk-Kazyna in 2014 commissioned 13 projects worth US $2.9 billion and created more than 5.6 thousand temporary and 1.2 thousand permanent jobs, the Fund’s CEO Umirzak Shukeyev said last Friday while reporting on measures to implement the head of state’s instructions and Nurly Zhol program, and on the Fund’s financial results for the past year.
Samruk-Kazyna group of companies closed the year 2014 fairly well, Shukeyev said. According to preliminary data, the net income of the group was estimated at 458 billion tenge, the Fund said in a press release. The Fund has developed a set of measures in line with the President’s instructions, including optimization of its costs by 337 billion tenge or 7%………………………………………..Full Article: Source

Samruk Kazyna Eyeing Credit Amid Falling Oil

Posted on 24 February 2015 by VRS  |  Email |Print

Samruk-Kazyna, the sovereign wealth fund of the Republic of Kazakhstan issued a statement Friday saying it could borrow up to $2.5 billion this year, either locally or abroad, to ease the debt it holds on its oil assets, which have been hit by the crude prices’ slump, Raushan Nurshayeva, Mariya Gordeyeva and Dmitry Solovyov write for Reuters..
“If conditions on external markets are attractive enough for us, we will tap into foreign markets, although right now, we see that the situation in the internal market is more favourable for us to borrow,” Samruk-Kazyna JSC Chairman, Umirzak Shukeyev said to a press briefing, according to Reuters………………………………………..Full Article: Source

SOFAZ assets rose to $ 37.42 bln in 2014

Posted on 24 February 2015 by VRS  |  Email |Print

For current year estimated decline 3 billion in the wake value crude (Il Sole 24 Ore Thomson Financial) - Baku, Feb. 23 - Sofaz, the Sovereign Fund of Azerbaijan closes 2014 with assets worth a total of 37.42 billion dollars , up from 3.42 billion on an annual basis. During 2014, revenues primarily from royalties until amounted to 15.729 billion dollars.
The outputs in favor of the state budget were approximately 12.9 billion in addition to funding for other special initiatives: scholarships for deserving students abroad, support for refugees from the region of Nagorno Karabakh occupied by Armenia, financing Kars railway line Baku Tbilis connection with Turkey, the company ‘management of pipelines and refinery Tap and Tanap Star-Petkim in Turkey……………………………………….Full Article: Source

Manat öldu: Devaluation in favour of Oil Fund

Posted on 24 February 2015 by VRS  |  Email |Print

Devaluation of manat on February 21 has identified the only player who won as a result of the Central Bank’s decision: the State Oil Fund of Azerbaijan (SOFAZ). In spite of foreign estimates manat devaluation didn’t cause total panic in Baku. In general, people treated this situation from philosophical point of view and even tried to joke. Thus, for example, today a man and his wife exchanged the following words while admiring fresh frosty air in the morning: “Nə “клёво”? Manat öldu” (What’s good in it? Manat has died).
Manat has died. It can rise from dead but there’s a direct beneficiary of its death. Such beneficiary is SOFAZ, which receives revenue in US dollars and transfers manats to the state budget………………………………………..Full Article: Source

Projected earnings of Temasek Holdings to be part of Govt’s Net Investment Returns Framework

Posted on 24 February 2015 by VRS  |  Email |Print

With government spending set to increase, Finance Minister Tharman Shanmugaratnam said that it is necessary to take steps to strengthen future revenues, with the first step being to include the projected earnings of Temasek Holdings in the Net Investment Returns (NIR) framework. Under this framework, the Government is allowed to spend up to 50 per cent of the expected long-term real returns on net assets managed by the investment entities of Monetary Authority of Singapore and GIC.
The portolios of GIC and MAS are already part of the NIR framework. The inclusion of Temasek Holdings was deferred as there was no established methodology for projecting the long term expected real returns on its portfolio, as well as its still evolving investment strategy, said Mr Tharman, who delivered the Budget Statement in Parliament today (Feb 23)………………………………………..Full Article: Source

Temasek to contribute more to govt coffers

Posted on 24 February 2015 by VRS  |  Email |Print

In a surprise move, Temasek Holdings from 2017 will be contributing more to the government’s coffers as it gets included in the Net Investment Returns (NIR) framework. It has been contributing about S$2 billion of dividends on average in the last five years. Singapore will include the total expected returns from Temasek Holdings in its NIR framework, said Tharman Shanmugaratnam, Deputy Prime Minister and Finance Minister, on Monday.
The current NIR framework - implemented in 2009 - permitted the government to spend up to 50 per cent of the expected long-term real returns on its net assets managed by GIC, and the Monetary Authority of Singapore (MAS)………………………………………..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 teetering state investment fund plagued by scandal

Posted on 24 February 2015 by VRS  |  Email |Print

By meeting a repayment deadline for the first time in months, Malaysia’s troubled sovereign wealth fund, 1Malaysia Development Berhad, seems to have staved off a debt crisis that threatened the country’s entire banking system. Reports in Kuala Lumpur say Malaysian billionaire Ananda Krishnan came up with the $693 million that the fund, known as 1MDB, was due to repay by February 18 to the country’s largest bank, Malayan Banking Bhd, and a smaller financial house, RHB Capital Bhd.
While the payment appears to have given 1MDB some breathing space after the fund repeatedly failed to meet debt repayment deadlines, it has done nothing to remove questions about the $14.5 billion in debts the fund has accumulated since its founding in 2009………………………………………..Full Article: Source

1MDB chief: PetroSaudi deal made RM1.78b in profits

Posted on 24 February 2015 by VRS  |  Email |Print

Troubled sovereign fund 1Malaysia Development Bhd (1MDB) claimed that a joint venture (JV) with a Saudi Arabian company six years ago, which critics claimed was shady, had earned it a profit of US$488 million (RM1.78 billion).
In a statement on the company’s website, 1MDB president Arul Kanda Kandasamy also claimed that the money it had invested in the JV had been converted into murabaha notes when the plan did not go through. Earlier reports claimed that 1MDB had put US$1 billion into the deal with PetroSaudi International Ltd, a company with an allegedly sketchy track record………………………………………..Full Article: Source

Show Proof Of 1MDB’s US$488m Profit Whereabouts, DAP Insists

Posted on 24 February 2015 by VRS  |  Email |Print

DAP’s National Publicity Secretary Tony Pua today demanded the country’s 1Malaysia Development Board (IMDB) president Arul Kanda Kandasamy show proof of the whereabouts of a purported US$488 million profit from its joint venture with PetroSaudi International.
“Arul Kanda Kandasamy proudly announced that the sovereign fund made the US$488 million of profit from the PetroSaudi transaction but what we have at hand is at least US$1.1 billion missing in unknown whereabouts. “The next question to ask is hence, where exactly is the US$488 million of paper profit Arul was talking about,” said Pua who is also MP for Petaling Jaya in a press conference at the DAP’s headquarters………………………………………..Full Article: Source

Howai: No HSF deposits this year

Posted on 24 February 2015 by VRS  |  Email |Print

There will be no deposits to the Heritage and Stabilisation Fund (HSF) for this year. This has been confirmed by Finance Minister Larry Howai who told Guardian Media Limited who explained that because the price of oil has fallen below the price identified in the national budget, “there will be no room to make any deposits this year.”
Over the past 42 years that T&T has been exporting oil and gas, billions of dollars have been earned in revenue which has been used for many of the social and infrastructural projects the country benefits from today………………………………………..Full Article: Source

Kazakh state wealth fund considers up to $2.5 bln borrowing in 2015

Posted on 23 February 2015 by VRS  |  Email |Print

Kazakhstan’s sovereign wealth fund Samruk-Kazyna is considering borrowing up to $2.5 billion this year abroad or domestically, depending on market conditions, fund chief Umirzak Shukeyev said on Friday. “We will probably need to borrow $2 billion or up to $2.5 billion this year,” Shukeyev told a news briefing. “We are now thinking where to borrow. It will all depend on conditions.”
“If conditions on external markets are attractive enough for us, we will tap foreign markets, although right now we see that the siatuation on the internal market is more favourable for us to borrow.”……………………………………….Full Article: Source

Kazakh Fund Says FX Sales Alone Won’t Shore Up Tenge

Posted on 23 February 2015 by VRS  |  Email |Print

Kazakhstan’s sovereign wealth fund, which controls oil producer KazMunaiGaz and the nation’s rail monopoly, said selling its companies’ foreign-currency earnings alone won’t stave off pressure on the tenge to decline.
“We are ready to fully support” a request to stabilize the tenge and the Kazakh financial sector, “but we will do it intelligently, taking into account the needs of every unit,” Yelena Bakhmutova, deputy chief executive officer of the fund, known as Samruk-Kazyna, said in an interview in Almaty on Friday. “We will try to implement our part, but I am afraid that our deeds alone won’t change the situation on the market.”……………………………………….Full Article: Source

PNG wealth fund bill passes first reading

Posted on 23 February 2015 by VRS  |  Email |Print

The Prime Minister Peter O’Neill introduced the bill, reportedly designed to safeguard the nation’s wealth generated from its petroleum and mineral resources.The Post Courier reports that Parliament voted 82-0 for the bill on its first reading - it is expected to become law by April after a third reading.
Mr O’Neill said it was urgent to pass the law because the first revenue from PNG’s landmark LNG gas project will be paid in late March, as advised by operator ExxonMobil. Mr O’Neill said there are two components to the overall Fund, one a “future’s fund” and the other a “stabilisation fund”………………………………………..Full Article: Source

Russian Sovereign Wealth Funds: 2015 Drawdowns

Posted on 23 February 2015 by VRS  |  Email |Print

Back at the end of January, Russia’s sovereign wealth funds amounted to USD160 billion, with the government primarily taking a historically set approach (from 2003 onwards) of arms-length interactions with the funds’ management. This relative non-interference marked 2014 and is now set to be changed, with the government looking at using SWFs to provide some support for the investment that has been falling in the 2013-2014 period and is likely to fall even further this year.
Fixed investment in Russia fell 2.0% y/y in 2013, and by another 3.7% in 2014. Private investment is likely to fall by double digits in 2015, based on the cost of funding, lack of access to international funding and general recession in the economy. It is likely to stay in negative growth territory through 2016………………………………………..Full Article: Source

Jonathan Still The Best Man To rule Nigeria – Ex-Gov Obi

Posted on 23 February 2015 by VRS  |  Email |Print

Nigerians have been urged to give another four years to President Goodluck Jonathan because he is head and shoulder above his All Progressives Congress, (APC) rival, Major General Muhammadu Buhari. Former Anambra State Governor, Peter Obi, who is also the Deputy Chairman of the Jonathan/ Sambo Campaign Organisation, made the appeal.
Citing the establishment of the Sovereign Wealth Fund, (SWF), as one notable example, Obi said that when the country had the Excess Crude Account, there were always agitations from everyone, including governors, that the money should be shared. But, “Jonathan’s government had moved from Excess Crude Account to Sovereign Wealth Fund. With the former, governors, and everybody, all of us would go to Abuja and say, ‘let’s share it’, but you can’t share the Sovereign Wealth Fund. It is managed internationally. It’s there for everybody and everybody can see it”………………………………………..Full Article: Source

Gulf invests $3bn in UK property in 2014

Posted on 23 February 2015 by VRS  |  Email |Print

Gulf states directly invested $3 billion in UK property in 2014, according to new statistics. As yet unpublished research by CBRE shows that the Gulf accounted for 10 percent of the total $26 billion of direct capital flows into the UK real estate market – predominantly in London – last year.
Almost 50 percent of that contribution came from Qatar, which directly invested at least $1.3 billion through transactions including the acquisition of HSBC’s London headquarters by the nation’s sovereign wealth fund, and of Canary Wharf owner Songbird Estates by a Qatari-led consortium last month………………………………………..Full Article: Source

Abu Dhabi fund buys hotel in Miami Beach for $230 million

Posted on 23 February 2015 by VRS  |  Email |Print

An investment group from the United Arab Emirates bought the newly-opened Miami Beach Edition hotel for $230 million. Hotel company Marriott International had developed the beach property, which opened in December and $1,000-per-night rates. It sold the 294-room hotel to companies owned by the Abu Dhabi Investment Authority, according to The Miami Herald newspaper.
Maryland-based Marriott had announced in 2013 that it intended to sell three Edition hotels — in Miami Beach, London and New York — to the sovereign wealth fund for a total of $800 million, while retaining long-term management agreements, the newspaper said. The Abu Dhabi Investment Authority invests money on behalf of the government of the oil-rich emirate of Abu Dhabi in the Persian Gulf. By some estimates, its assets now top $800 billion………………………………………..Full Article: Source

Where is Christy Clark’s plan now to save some revenue from B.C.’s rich resources?

Posted on 23 February 2015 by VRS  |  Email |Print

In the run-up to the 2013 election, Premier Christy Clark was dreaming big about sky-high LNG revenues, and a soon-to-be established Prosperity Fund to share today’s revenue from the non-renewable resource with tomorrow’s citizens. Does this mean the idea of some kind of sovereign wealth fund is, like much of Clark’s projected revenue stream, dead in the water?
Of course a sovereign wealth fund is more than just a pot of money that sits and grows and is never spent. The authors note that other jurisdictions put earnings from the savings to such uses as stabilizing government revenues over time, funding infrastructure and even maintaining healthy pension funds………………………………………..Full Article: Source

Abu Dhabi to buy New York Edition hotel

Posted on 20 February 2015 by VRS  |  Email |Print

The Abu Dhabi Investment Authority, the sovereign wealth fund of the oil-rich emirate, is buying the upcoming Edition hotel at Madison Square Park, seller Marriott International announced. Marriott and hotelier Ian Schrager launched the Edition brand in 2008. The property, located at 5 Madison Avenue, is expected to wrap up construction by the end of the first quarter. An Edition in Times Square is also in the cards for 2017.
The Abu Dhabi Investment Authority, which bought the London Edition hotel last year, closed today on the purchase of the Miami Beach Edition in South Florida for $230 million. The New York deal is slated to close in the first quarter of 2015 at a yet-undisclosed price………………………………………..Full Article: Source

Marriott sells Miami Beach Edition hotel for $230M

Posted on 20 February 2015 by VRS  |  Email |Print

Marriott International has sold the Miami Beach Edition hotel for $230 million to the Abu Dhabi Investment Authority (ADIA), a sovereign wealth fund owned by Emirate of Abu Dhabi. The Maryland-based company announced Thursday that the property at 2901 Collins Avenue in Miami Beach is one of three Edition properties being sold to ADIA. The first was the London Edition sold in January 2014 and Marriott expects to sell the third Edition hotel, New York Edition, in the first quarter of 2015.
Marriott is currently developing Florida’s first AC Hotel nearby at 2912 Collins Avenue in Miami Beach with Robert Finvarb Companies, which is set to open in April. As previously reported, the Miami Beach hotel opened in November and doubled its budgeted profitability during the first two months of operations, said Ian Schrager who worked with Marriott to build the property………………………………………..Full Article: Source

New Zealand Fund to Sue Over Loss on Espírito Santo Loan

Posted on 20 February 2015 by VRS  |  Email |Print

Fallout from Banco Espírito Santo SA’s August collapse hit New Zealand on Thursday, as the country’s state retirement fund said it lost $150 million and is suing Portugal’s central bank over an investment linked to the Portuguese lender. The New Zealand Superannuation Fund in July invested $150 million in notes issued by Oak Finance Luxembourg SA, a vehicle arranged by Goldman Sachs Group Inc. to make an $835 million loan to Banco Espírito Santo.
When Banco Espírito Santo failed a month later, the Oak Finance loan was placed in a successor bank, called Novo Banco, that kept the collapsed lender’s good assets and continues to operate. But in December, the loan was moved by the Bank of Portugal to the “bad bank” of the lender, which holds assets to be liquidated and where the loan has virtually no chance of being repaid………………………………………..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

1MDB belongs to the people, says veteran journalist

Posted on 20 February 2015 by VRS  |  Email |Print

1MDB belongs to the people, said veteran journalist Datuk A Kadir Jasin, who argued that the troubled sovereign wealth fund cannot hide behind a technicality to justify its secret business dealings.
The former New Straits Times (NST) group editor-in-chief said 1MDB was a government-owned company that is answerable to the people and so far, many of its replies to issues raised by politicians and the media were inadequate. “1MDB is more than a listed company. It is a government-owned company and is, therefore, answerable to the people,” Kadir wrote in his latest blog posting……………………………………….Full Article: Source

Five charts that explain the world’s wealth distribution

Posted on 19 February 2015 by VRS  |  Email |Print

Sovereign wealth funds have been important participants in financial markets over the past decade but as the charts below show, the fortunes of most sovereign wealth funds are tied to oil. For instance, the biggest sovereign wealth fund, Norway’s Government Pension Fund Global (formerly the Government Petroleum Fund) derives its funding from profits generated by the country’s petroleum sector. Most other large sovereign wealth funds are also financed by oil profits.
If oil prices remain low for quite some time to come, it will hit these funds hard. The only exception to oil-based sovereign wealth funds are the Chinese funds, which have grown in size and influence over the past few years………………………………………..Full Article: Source

ICT Ministry, SOFAZ postpone financing of Fiber to Home project

Posted on 19 February 2015 by VRS  |  Email |Print

Ministry of Communications and High-Tech and the State Oil Fund of Azerbaijan (SOFAZ) postponed the financing of Fiber to Home project (”Optics in house”), providing for maintenance of broadband Internet throughout the country.
As part of the Caspian-European Club (CEIBC) meeting which was held in Baku, the Minister of Communications and High Technologies Ali Abbasov told reporters that the funding for the project by the SOFAR is postponed for the period after 2016, 1news.az reports. At the same time, he noted that new sources of funding for the project are found………………………………………..Full Article: Source

Azerbaijan starts talks with world’s leader banks on funding fiber to home program

Posted on 19 February 2015 by VRS  |  Email |Print

The Ministry of Communications & High Technologies of Azerbaijan (RYTN) is trying to save the national program of fiber-optic network development - fiber to home. At a meeting in the Caspian-European Club (CEIBC) Communications Minister Ali Abbasov has stated that negotiations with international banks about financing for the program realization have been launched.
Earlier, the State Oil Fund of Azerbaijan (SOFAZ) undertook the obligation to allocate $100 million for the program, but the funding has not yet been opened. The total cost of the program to be implemented for 3 years is estimated at EUR 500 million………………………………………..Full Article: Source

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