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Sovereign Wealth Funds Briefing - Archive | October, 2015

Sovereign wealth funds face a rainy day

Posted on 30 October 2015 by VRS  |  Email |Print

The 46 countries that have at least one sovereign wealth fund have largely set them up for a rainy day. Now that day has come for most of them. Commodity prices are so depressed that governments need to unseal their piggy banks and with profitable investment opportunities scarce there is little incentive not to. This could end up putting downward pressure on global financial markets.
Of the top 30 sovereign funds, 18 are filled with revenues from oil and gas. The largest of the funds, set up in 1990 to safeguard Norway’s oil wealth for future generations, posted its biggest loss in four years this week. It shed $32 billion in the third quarter, all in the stock market, which accounts for 60 percent of its investments………………………………………..Full Article: Source

Norway Oil Fund Rejects Divestment Option Even as Cash Runs Out

Posted on 30 October 2015 by VRS  |  Email |Print

For Norway’s $860 billion wealth fund, selling assets represents a cost it would rather avoid. The world’s biggest sovereign wealth fund says it won’t resort to divestments even as the government prepares to make withdrawals for the first time next year.
That development and the fund’s dwindling returns had fueled speculation it will need to sell assets in Europe if it’s to follow a strategy of increasing its emerging market holdings. But for now, the fund’s cash flow of about 200 billion kroner ($24 billion) from its investments provides a buffer as the environment in which it operates is turned on its head………………………………………..Full Article: Source

Will Norway’s wealth fund losses affect its Indian portfolio?

Posted on 30 October 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund, the world’s largest, has posted $32 billion in losses in the quarter ended September 2015 — the biggest loss in the last four years mainly due to the falls in China’s stock market and Volkswagen AG. Norway’s wealth fund is one of the biggest foreign institutional investors in India with assets under management of at least Rs 19,000 crore in listed stocks.
Total assets under management by sovereign wealth funds in India as on August 2015 were at Rs 1.7 lakh crore. The fund’s CEO recently told Bloomberg that there won’t be a need to sell anything at this juncture, but investors could keep a watch on its portfolio………………………………………..Full Article: Source

Norway and MoF plan natural resource fund

Posted on 30 October 2015 by VRS  |  Email |Print

Norwegian experts suggested the idea several months ago and have since been collecting data, deputy finance minister U Maung Maung Thein told The Myanmar Times. Meanwhile, the finance ministry has formed a committee, he said.
A natural resource fund is a type of sovereign wealth fund – a special-purpose investment vehicle owned by a government, and financed by revenues from oil, gas or mineral sales. The money can be used in a number of ways including covering unexpected budget deficits, ring-fencing resource revenues or saving for future generations, according to non-profit Natural Resource Governance Institute (NRGI)………………………………………..Full Article: Source

Norway wealth fund drops €29.4bn amid market rout

Posted on 30 October 2015 by VRS  |  Email |Print

The world’s largest sovereign wealth fund, which is Norwegian, has posted its biggest loss in four years, just as the government is preparing to make its first ever withdrawals to plug budget deficits. The fund lost 273bn kroner (€29.4bn) in the third quarter, or 4.9%, as stocks declined 8.6% and bonds rose 0.9%, the Oslo-based fund said yesterday.
Real-estate holdings rose 3%. It was the first back-to-back quarterly loss in six years. “We have to expect fluctuations in the value of the fund, when there are large movements in the market,” Yngve Slyngstad, chief executive of the fund, said………………………………………..Full Article: Source

Oil Prices Could Deplete Russia’s Sovereign Funds by the End of 2016

Posted on 30 October 2015 by VRS  |  Email |Print

Russia’s Ministry of Finance released a draft budget for 2016, which relies heavily on the country’s sovereign fund to bridge its growing deficit gap. According to Russia’s Finance Minister Anton Siluanov, the country’s sovereign fund will no longer be able to serve as the main source to finance the budget deficit following 2016, reports TASS.
“Our reserves volume [in 2015] will decrease by approximately 2.6 trillion rubles ($40.85 billion) – more than half. This means that 2016 is the last year when we are able to spend our reserves that way. After that we will not have such resources,” he said………………………………………..Full Article: Source

Nigeria planning $25 bln infrastructure fund - official

Posted on 30 October 2015 by VRS  |  Email |Print

Nigeria plans to set up a $25 billion infrastructure fund to invest in the transport and energy sectors in Africa’s most populous nation, a spokesman for Vice President Yemi Osinbajo said on Thursday. Laolu Akande said money for the planned fund would come from local and international sources including Nigeria’s sovereign wealth fund and domestic pension funds.
“The vice president disclosed that other sovereign wealth funds have already indicated an interest in the fund, which would be used to address the nation’s decaying road, rail and power infrastructures,” said Akande………………………………………..Full Article: Source

Qatar joins Brookfield’s $8.6b Manhattan west project

Posted on 30 October 2015 by VRS  |  Email |Print

Brookfield Property Partners LP and Qatar Investment Authority formed a joint venture on Manhattan West, an $8.6 billion (Dh31.6 billion) mixed-use project under construction on New York’s far west side. Plans for the 650,000-square-metre development call for five buildings, including a 62-story, 844- unit residential tower that’s already in progress and a 67-story office skyscraper that will be anchored by the law firm Skadden, Arps, Slate, Meagher & Flom LLP and is scheduled for completion in 2019.
Qatar Investment Authority will acquire a 44 per cent stake in the project, the companies said in a statement Wednesday. The deal expands the sovereign wealth fund’s global investments, which include acquisitions this year of London’s Canary Wharf Group and parent Songbird Estates Plc, both in partnership with Brookfield………………………………………..Full Article: Source

Omani sovereign wealth fund calls in Freshfields to sue Bulgaria

Posted on 30 October 2015 by VRS  |  Email |Print

Oman’s largest sovereign wealth fund has hired Freshfields Bruckhaus Deringer to take Bulgaria to arbitration over its role in the collapse in Balkan bank KTB, while the Bulgarian government has instructed Arnold & Porter to defend the claim ahead of preferred law firm White & Case.
Freshfields partners Boris Kasolowsky in Frankfurt and Willibald Plesser in Vienna have been handed the task of recouping losses suffered by the State General Reserve Fund of Oman after KTB closed in June 2014. The arbitration claim, understood to be valued at more than $100m including interest, has been filed at the World Bank’s arbitration court, the International Centre for Settlement of Investor Disputes (ICSID)………………………………………..Full Article: Source

Zambia moves to operationalize Sovereign Wealth Fund

Posted on 30 October 2015 by VRS  |  Email |Print

Zambia, Africa’s second largest copper producer seeks to formalize the operationalization of the Sovereign Wealth Fund as the Southern African state grapples with resolving the escalating debt burden, feared by many to have hit a ceiling. According to Wikipedia, the fund is a state-owned investment fund investing in real and financial assets such as stocks, bonds, real estate, precious metals, or in alternative investments such as private equity fund or hedge funds.
Most SWFs, by definition, are funded by revenues from commodity exports or from foreign-exchange reserves held by the central bank. By historic convention, the United States’ Social Security Trust Fund, with $2.8 trillion of assets in 2014, is not considered a sovereign wealth fund………………………………………..Full Article: Source

How Singapore’s S$266 billion investment giant Temasek rode the Chinese share boom

Posted on 30 October 2015 by VRS  |  Email |Print

Unorthodox, resilient and with an enviable earnings record, sovereign wealth fund Temasek is not frightened by the equities roller-coaster. When the Singapore sovereign wealth fund Temasek unveiled an almighty 19.2 per cent one-year return to shareholders in July this year, many questions followed.
Aren’t sovereign funds supposed to be staid and boring, aiming for a shade over inflation? How much risk are they taking to come out with a number like that? How do we do the same? Numbers like these – a total shareholder return of 16 per cent a year since inception in 1974 and 9 per cent annualised over the deeply troubled past 10 years – cause many new sovereign vehicles to look to Temasek as a role model………………………………………..Full Article: Source

1MDB’s head agrees to live television debate

Posted on 30 October 2015 by VRS  |  Email |Print

The saga at Malaysia’s beleaguered sovereign wealth fund 1Malaysia Development Berhad (1MDB) has taken another turn, with the fund’s top executive agreeing Thursday to a live television debate.
Arul Kanda, 1MDB’s president and group executive director, announced in a statement that he was willing to a verbal sparring session with opposition leader Tony Pua, but on one condition: Pua must resign from the Public Accounts Committee, which is investigating 1MDB………………………………………..Full Article: Source

Starwood attracting Chinese interest

Posted on 30 October 2015 by VRS  |  Email |Print

China’s sovereign wealth fund and two big Chinese companies have expressed interest in Starwood Hotels & Resorts Worldwide, joining other potential suitors from around the world, a source familiar with the matter said.
Starwood Hotels, the owner of St Regis and Sheraton hotel brands, has indicated it is considering a sale, and its highly prized collection of properties has also garnered interest from wealthy Middle Eastern investors and other global firms, the person said………………………………………..Full Article: Source

AK Attorney general presents proposal leveraging Permanent Fund to pay for budget

Posted on 30 October 2015 by VRS  |  Email |Print

Gov. Bill Walker’s administration says it wants to leverage the Permanent Fund to help balance the state budget in the long-term. His office says it isn’t a final proposal, but an idea it wants to present to the Legislature. Attorney General Craig Richards gave a presentation on the concept to lawmakers Tuesday afternoon.
The administration said it wants to create a new fund, called a Sovereign Wealth Fund (SWF). Under the plan, the amount of royalty oil revenue flowing into the permanent fund would be doubled. That money would be combined with other revenues to create a steady stream of money for the budget, regardless of oil prices………………………………………..Full Article: Source

Norway oil fund reports third biggest loss ever

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s oil fund on Wednesday reported its worst quarterly loss in four years, as it was hit by a collapse in the Chinese stock market, and big losses on investments in Volkswagen and Glencore. Norges Bank Investment Management (NBIM) which manages the world’s largest sovereign wealth fund, reported the the fund’s value had declined by 4.9 percent over the period, losing a staggering 273bn kroner ($32bn).
NBIM said the loss represented the third weakest result in kroner since the fund was launched. “The negative return on equity investments was driven by the slowdown in the global economy and the decline in global equity markets, especially the Chinese market,” Yngve Slyngstad, NBIM’s chief executive, said in a statement. ……………………………………….Full Article: Source

World’s Largest Wealth Fund Hit by Oil Slump, Emerging Markets Volatility

Posted on 29 October 2015 by VRS  |  Email |Print

The Norwegian state-controlled oil fund reported losses for the first time in four years just as Oslo is planning to start cash withdrawals for the first time in history, thus leveraging additional pressure to enhance the fund’s market performance.
Kristian Rouz — Norges Bank Investment Management (NBIM), the world’s biggest sovereign wealth fund, reported its biggest losses in roughly four years this past quarter, as the global economic slowdown and Volkswagen scandal weighed on the aggregated value of the fund’s investment. ……………………………………….Full Article: Source

Norway oil fund’s investments value slide nearly 5%

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s sovereign-wealth fund, the world’s biggest by assets, reported a near five percentage-point loss on its investments in the third quarter, pulled down by negative returns from its equity investments amid weaker global markets.
Norges Bank Investment Management, the arm of the central bank that manages the fund, said Wednesday that the value of the fund’s investments fell by 273 billion Norwegian kroner ($32.17 billion) before the impact of a weaker Norwegian krone in the period………………………………………..Full Article: Source

Norway’s oil fund makes 2nd quarterly loss in row

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s $863 billion sovereign wealth fund made a loss on its investments in the three months ended September for the second quarter in a row, as stocks continued to drop and Volkswagen weighed on results, the fund said today.
The fund lost 273 billion crowns ($32 billion) in the quarter, after a loss of 73 billion from April to June, equivalent to a return on investment of minus 4.9% in the third quarter, against minus 0.9% in the second quarter. Those losses were recouped in October, with the fund earning some 300 billion crowns, the fund’s chief executive later said………………………………………..Full Article: Source

Norway Seeks Explanation From VW Over Emissions Scandal

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s sovereign-wealth fund, the world’s biggest by assets, said Wednesday it would seek explanations from Volkswagen AG over an emissions cheating crisis that nearly halved the value of its interest in the German car market and hit its overall performance in the third quarter.
The fund, which held 1.22% of VW—worth 9.6 billion Norwegian kroner ($1.13 billion) at the end of 2014—said its stake lost 4.9 billion kroner in the third quarter. “Volkswagen was clearly the biggest negative contributor in the third quarter,” said Norges Bank Investment Management’s deputy chief executive, Trond Grande………………………………………..Full Article: Source

Volkswagen has about neutral weighting in Norway fund’s portfolio-deputy CEO

Posted on 29 October 2015 by VRS  |  Email |Print

Norway’s $863 billion sovereign wealth fund has a roughly neutral weighting in the fund’s portfolio, a top official said on Wednesday, after the fund posted its second quarterly loss in a row, with Volkswagen weighing on the results.
“It (the Volkswagen share) is about neutrally weighted,” deputy chief executive Trond Grande told a news conference………………………………………..Full Article: Source

Qatar to acquire a stake in Brookfield’s Manhattan West project

Posted on 29 October 2015 by VRS  |  Email |Print

Brookfield Property Partners is partnering with the Qatar Investment Authority – the energy-rich nation’s sovereign wealth fund – on Brookfield’s $8.6 billion Manhattan West mixed-use development on the Far West Side. QIA will acquire a 44 percent stake in the five-building project — which includes a 62-story, 844-unit residential tower currently under construction and the 67-story One Manhattan West office building slated for completion in 2019.
The deal, announced Wednesday, is not the first time the two parties have teamed up, according to Bloomberg, with the sovereign wealth fund joining forces with Brookfield earlier this year to acquire London-based firms Canary Wharf Group and Songbird Estates………………………………………..Full Article: Source

India’s ReNew Power sells stake to Abu Dhabi sovereign fund

Posted on 29 October 2015 by VRS  |  Email |Print

Indian solar and wind energy company ReNew Power Ventures Pvt Ltd sold a “significant minority stake” to a subsidiary of Abu Dhabi Investment Authority (ADIA) for $200 million, the company said in a statement.
ADIA’s investment was part of a broader $265-million fundraising by new and existing investors in ReNew Power Ventures, it added. Financial adviser Rothschild advised the Abu Dhabi sovereign wealth fund. ReNew Power will use the funds as capital expenditure for its solar and wind projects, according to the statement………………………………………..Full Article: Source

Chinese Giants Compete to Bid for Starwood’s $12B Hotel Portfolio

Posted on 29 October 2015 by VRS  |  Email |Print

A government fund, a state-owned hotel operator and an airline from China are all lining up to bid for America’s Starwood Hotels and Resorts Worldwide in a deal that, if realised, would set a new record for Chinese investment in the US.
Sovereign wealth fund China Investment Corporation (CIC), HNA – the parent company of China’s Hainan Airlines, and Shanghai-based Jin Jiang Hotel Group are all said to have submitted proposals to the central government to bid on the American hospitality group, according to an account in The Wall Street Journal………………………………………..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

Walker proposes Permanent Fund overhaul to cover deficit

Posted on 29 October 2015 by VRS  |  Email |Print

Governor Bill Walker will propose overhauling the way Alaska uses the Permanent Fund when he releases his budget later this year. The plan would turn the state’s various savings accounts into a kind of endowment, using their earnings to fund state operations.
The governor’s goal is to shift the state from a reliance on oil revenue to a reliance on the earnings of its massive reserve funds, an idea the administration is comparing to the sovereign wealth funds used in oil-dependent states like Norway. The governor’s administration is holding a briefing at noon for lawmakers who are gathered in Juneau for a special legislative session on a natural gas line………………………………………..Full Article: Source

Weak oil prices deplete Russia’s sovereign-wealth fund

Posted on 28 October 2015 by VRS  |  Email |Print

Russia is running out of emergency funds. The country, which has been relying on its sovereign-wealth fund to plug gaps in its budget deficit, said its Reserve Fund is likely to be depleted in 2016. The news is another blow to an economy reeling from weak oil prices and Western-led sanctions in connection with fighting in Ukraine.
“Our reserves volume will decrease by approximately 2.6 trillion rubles ($40.85 billion) — more than half. This means that 2016 is the last year when we are able to spend our reserves that way. After that we will not have such resources,” Russian Finance Minister Anton Siluanov told Tass, the government-owned news agency………………………………………..Full Article: Source

Kazakh Fund Signs US$1.5 Billion Loan To Buy Kashagan Field Stake

Posted on 28 October 2015 by VRS  |  Email |Print

Kazakh sovereign wealth fund Samruk-Kazyna said on Oct. 27 it had signed a five-year syndicated loan worth up to $1.5 billion to help it buy a stake in the Kashagan oilfield from Kazakh state oil and gas firm KazMunaiGas. The Bank of Tokyo Mitsubishi UFJ, Ltd. was mandated as the sole coordinator, bookrunner and lead arranger for the loan which was Samruk’s debut transaction of the kind.
Samruk, managing state-run stakes in major Kazakh companies varying from oil and gas to railways, airlines and uranium, said the loan had originally been signed for $1 billion, but a clause in the deal would allow it to raise the amount to $1.5 billion………………………………………..Full Article: Source

Norway’s sovereign fund calls for transparency on water lobbying

Posted on 28 October 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund has urged companies to be transparent on lobbying surrounding water management and risks. Companies should also promote best practice of water usage and consider putting in place a mechanism that allows third parties to consult with them directly on matters of water management, according to a revised paper released by Norges Bank Investment Management (NBIM).
The manager for Norway’s Government Pension Fund Global, long active in the area of water management and a supporter of charity CDP on the matter, also urged companies to engage directly with local communities about water reclamation………………………………………..Full Article: Source

Has the world’s largest sovereign wealth fund peaked?

Posted on 28 October 2015 by VRS  |  Email |Print

Just weeks after the Nobel prizes were announced out of Norway, world attention will shift back to Oslo this week when Norwegians find out how well their country’s sovereign wealth fund, the world’s largest, has weathered the rollercoaster ride in the price of oil.
The signs are worrying: For the first time ever, Norway announced plans to tap its fund to make up for lost oil revenues earlier this month. The country plans on withdrawing around $450 million from the fund which had $820 billion under management as of the end of June of this year………………………………………..Full Article: Source

Azerbaijan Oil Fund’s investment portfolio exceeds limit for 2015 by 28.7%

Posted on 28 October 2015 by VRS  |  Email |Print

By 1 October 2015 the State Oil Fund of Azerbaijan (SOFAZ) exceeded the limit of investment portfolio (AZN 28.2 bn) for 2015 by 28.7%. The Fund reports that its investment portfolio in manats, as a base currency, grew by 26% from AZN 28.79 bn up to AZN 36.28 bn for the past 3 quarters. Over the 3 rd quarter the decline totaled AZN 1.176 bn or 3.1%. By 1 October the Fund’s investment portfolio was estimated at $34.6 bn.
The main directions (investment program) of SOFAZ money spending for 2015 are to pursue investment policy aimed at obtaining the highest possible income with minimum risk of losing assets. Fund’s investment portfolio for 2015 is limited to AZN 28.2 bn. The Fund is allowed the following currency structure: 50% of finances in US dollars, 35% in euro, 5% in pounds of sterling and the remaining 10% in other currencies………………………………………..Full Article: Source

Oman Fund Claims against Bulgaria ‘Unfounded’ - FinMin

Posted on 28 October 2015 by VRS  |  Email |Print

Legal action taken against Bulgaria by the State General Reserve Fund of Oman is based on ill-founded claims, the country’s Finance Minister Vladislav Goranov said on Tuesday. He asserted Bulgaria was “prepared to fight this battle” and had already hired a team of lawyers.
His comments follow reports (later confirmed by the government) that the sovereign wealth fund was seeking to recover the book value of its investment in collapsed Corporate Commercial Bank (Corpbank or KTB)………………………………………..Full Article: Source

Omani wealth fund takes $165m legal action against Bulgaria over bank collapse

Posted on 28 October 2015 by VRS  |  Email |Print

Oman’s biggest sovereign wealth fund has filed an arbitration claim against Bulgaria over the collapse of Corporate Commercial Bank (Corpbank), the online database of Washington-based International Centre for Settlement of Investment Disputes showed.
Oman’s State General Reserve Fund (SGRF) fund owned a 30 percent stake in Corpbank, which was Bulgaria’s fourth-largest lender before collapsing last year following a bank run. The bank collapse triggered the Balkan country’s biggest financial crisis since the 1990s, prompting Sofia to pay over 3.6 billion levs ($2.03 billion) to guaranteed depositors and boosting the country’s fiscal deficit for 2014 to 5.8 percent of economic output………………………………………..Full Article: Source

Saudi Wealth Fund Said to Seek Bankers in Global Deals Shift

Posted on 28 October 2015 by VRS  |  Email |Print

Saudi Arabia’s Public Investment Fund is seeking to hire bankers for international deals to help the kingdom acquire overseas technology and expertise, four people with knowledge of the matter said.
The sovereign wealth fund, which holds about $100 billion worth of stakes in local companies, is looking to appoint Saudi nationals with experience at both local and international investment banks, the people said, asking not to be identified as the talks are private. The hires will help the fund make strategic acquisitions in industries including transport, manufacturing and technology that will give Saudi Arabia access to foreign expertise and know-how, according to the people………………………………………..Full Article: Source

Saudi Arabia considers cutting energy subsidies to manage budget deficit

Posted on 28 October 2015 by VRS  |  Email |Print

The kingdom has financial reserves of about 100 per cent of GDP, but has sold foreign reserves and tapped local bond markets, while its sovereign wealth fund has sold assets in a bid to generate enough cash to plug the deficit.
Sama Foreign Holdings, the kingdom’s sovereign wealth fund, has sold up to $70 billion of assets as it seeks to plug the gap in spending, the Financial Times reported last month, while Nasdaq estimates that it has sold a further $1.8bn of its European equity holdings. Saudi Arabia is scheduled to offer $27bn in debt to local markets by the end of the year………………………………………..Full Article: Source

Crude slump hits Saudi-fund-linked stocks

Posted on 28 October 2015 by VRS  |  Email |Print

Saudi Arabian oil money appears to be ebbing out of global assets, including Japanese equities, amid a bear market for the kingdom’s top export.
J.P. Morgan estimates $100 billion in net selling of Saudi sovereign wealth investments so far in 2015, compared with $270 billion in net buying last year. Talk of trouble among presumed Saudi wealth fund holdings became more frequent among market watchers in late August………………………………………..Full Article: Source

India’s ReNew Power sells stake to Abu Dhabi sovereign fund

Posted on 28 October 2015 by VRS  |  Email |Print

Indian solar and wind energy company ReNew Power Ventures Pvt Ltd sold a “significant minority stake” to a subsidiary of Abu Dhabi Investment Authority (ADIA) for $200 million, the company said in a statement.
ADIA’s investment was part of a broader $265-million fundraising by new and existing investors in ReNew Power Ventures, it added. Financial adviser Rothschild advised the Abu Dhabi sovereign wealth fund………………………………………..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

Temasek-controlled Olam refinances with $1B in new loans

Posted on 28 October 2015 by VRS  |  Email |Print

Agri-trader Olam International has secured $1 billion in funding to refinance existing debt, just a couple of months after Mitsubishi Corp snagged a 20 percent stake in the company.
Olam said the new revolving credit and term loan facility will comprise an $850 million 364-day revolving credit facility and a $150 million 5-year term loan. Singapore state investor Temasek Holdings owns 51.4 percent of Olam………………………………………..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

Alberta Plans Higher Investment, Debt to Counter Oil-Sands Crash

Posted on 28 October 2015 by VRS  |  Email |Print

Alberta will boost investment in schools, hospitals and transportation projects and run deficits in a bid to stimulate growth as it confronts a collapse of oil-sands revenue that threw the western Canadian province into recession.
Producers in the province exported C$1.3 trillion worth of oil and gas between 1971 and 2015, most of which has been used to pay for health care, schools and transportation infrastructure. The province’s Heritage wealth fund is currently valued at about C$15 billion, compared with $1.1 trillion for Norway’s sovereign wealth fund, which was established after Alberta’s………………………………………..Full Article: Source

Alaska Gov. Walker plans briefings on fiscal concepts and budget

Posted on 28 October 2015 by VRS  |  Email |Print

Gov. Bill Walker has invited Alaska business leaders here Thursday for a discussion of his final fiscal plan and the unveiling of his budget, and lawmakers will get their own briefing Wednesday on a “sovereign wealth fund concept.”
Walker’s administration has been working for months to create a plan to balance Alaska’s budget. This year the state is spending $5 billion while bringing in just $2.2 billion in revenue following a steep decline in the price of oil. Taxes and royalties from North Slope oil make up the majority of state revenue………………………………………..Full Article: Source

Sovereign Wealth Funds In The New Era Of Oil

Posted on 28 October 2015 by VRS  |  Email |Print

As a result of the oil price plunge, the major oil-exporting countries are facing budget deficits for the first time in years. The growth in the assets of their sovereign wealth funds, which were rising at a rapid rate until recently, is now slowing; some have started drawing on their buffers.
In the short run, this phenomenon is not cause for alarm. Most oil exporters have enough buffers to withstand a temporary drop in oil prices. But what will happen if low oil prices persist, and how will policymakers react?……………………………………….Full Article: Source

Oman fund takes Bulgaria to arbitration over bank collapse

Posted on 27 October 2015 by VRS  |  Email |Print

Oman’s biggest sovereign wealth fund has filed an arbitration claim against Bulgaria over the collapse of Corporate Commercial Bank (Corpbank), the online database of Washington-based International Centre for Settlement of Investment Disputes showed.
Oman’s State General Reserve Fund (SGRF) fund owned a 30 percent stake in Corpbank, which was Bulgaria’s fourth-largest lender before collapsing last year following a bank run. The bank collapse triggered the Balkan country’s biggest financial crisis since the 1990s, prompting Sofia to pay over 3.6 billion levs ($2.03 billion) to guaranteed depositors and boosting the country’s fiscal deficit for 2014 to 5.8 percent of economic output……………………………………….Full Article: Source

Omani Sovereign Fund Said to Be Seeking EUR 720 M from Bulgaria over KTB Collapse

Posted on 27 October 2015 by VRS  |  Email |Print

The State General Reserve Fund of Oman has taken legal action against Bulgaria, seeking to recover the book value of its investment in collapsed Corporate Commercial Bank, Sofia-based 24 Chasa daily reported on Monday. The Omani sovereign wealth fund was also reportedly seeking interest payments for the period from the putting of the bank under the Bulgarian central bank’s control to the date when it was declared insolvent, 24 Chasa said.
The Bulgarian National Bank (BNB) put the country’s fourth-largest lender under direct administration on June 20, 2014 following a run on deposits, suspending shareholders’ rights. In April, Corporate Commercial Bank, known by its Bulgarian acronym KTB, was declared insolvent as of November 6, 2014 – the date when the BNB suspended its banking licence………………………………………..Full Article: Source

Japan joins Oman in setting up food and agribusiness fund

Posted on 27 October 2015 by VRS  |  Email |Print

Oman’s biggest sovereign wealth fund has agreed with Japanese institutions to set up a joint $400 million fund that will invest in food and agribusiness industries, Omani officials said on Sunday. The fund will facilitate direct investment in Gulf Cooperation Council (GCC) states by Japanese food and agribusiness firms, ranging from grains and feed to vegetables, milk and dairy products, logistics and research firms, they said, aiming to spend at least 35 percent of the money in Oman.
The Gulf Japan Food Fund will be owned 37.5 percent by Oman’s State General Reserve Fund. State-run Oman National Investments Development Co and Gulf Investment Corp, owned by the six GCC states, will hold a combined 12.5 percent………………………………………..Full Article: Source

Indo-Oman fund exits Solar Inds; sells shares worth Rs 240 crore

Posted on 27 October 2015 by VRS  |  Email |Print

Oman India Joint Investment Fund, a JV between SBI and Oman’s sovereign fund, today sold off its entire stake of 4.28 per cent in Solar Industries India Ltd for a little over Rs 240 crore. According to bulk deals data available with BSE, the special purpose vehicle (SPV) for promoting joint investment in projects in India sold 7,74,195 shares, amounting to 4.28 per cent stake of the company.
The investment fund was formed in 2011 by State Bank of India (SBI) and the State General Reserve Fund of Oman (SGRF)………………………………………..Full Article: Source

US, Qatari officials launch investment partnership

Posted on 27 October 2015 by VRS  |  Email |Print

U.S. Secretary of State John Kerry and Secretary of the Treasury Jacob Lew along with Qatari Foreign Minister Khaled Al-Attiya, Minister of Finance Ali Al-Emadi, and CEO of the Qatar Investment Authority Sheikh Abdullah Al-Thani inaugurated our first U.S.-Qatar Economic and Investment Dialogue today, marking a milestone in the bilateral relationship between our countries.
The dialogue will serve as an annual forum for convening key decision makers to identify concrete steps to bolster our financial, investment, and economic relations. Trade between the United States and Qatar has reached record levels, and the dialogue promises to help build upon that momentum. We are committed to the shared priorities of generating economic growth, creating jobs, and facilitating strong business relationships between Qatari and U.S. companies in a way that enhances prosperity for each country………………………………………..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

SOFAZ expects deficit-ridden budget in 2015

Posted on 27 October 2015 by VRS  |  Email |Print

Azerbaijan’s state oil fund SOFAZ expects its budget for 2015 to be deficit-ridden due to the long decline in world oil prices. SOFAZ told Trend last week that while drawing up the fund’s budget for 2015, the basic parameters of the state budget were taken as a basis and the expected oil price was set at $90 per barrel.
“Taking into account an oil price of $50 per barrel, SOFAZ’s total income, including the proceeds from the sale of oil and gas are predicted at 7.4 billion manats [$7.05 billion] until late 2015, which is 28 percent less than SOFAZ’s income approved for this year,” SOFAZ said………………………………………..Full Article: Source

Azeri oil fund’s assets drop by 6.4 pct to $34.7 bln by Oct. 1

Posted on 27 October 2015 by VRS  |  Email |Print

Azerbaijan’s state oil fund’s (Sofaz) assets fell by 6.38 percent to $34.7 billion by Oct. 1 from the start of the year, the fund said on Monday, hit by the drop in global oil prices. Sofaz holds the proceeds from oil contracts, oil and gas sales, transit fees and other revenue. It uses income from investments to fund social spending and infrastructure projects.
The fund said its revenue reached 5.5 billion manats ($5.2 billion) by Oct. 1, while expenditures were 6.4 billion manats. Sofaz said in September it had made its first real estate investment in Japan, buying retail property Kirarito Ginza in Tokyo for 52.3 billion yen ($432.27 million) with Mitsubishi UFJ Trust and Banking Corporation………………………………………..Full Article: Source

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