Insto roundup: Australia's Future Fund announces new investment strategy; China to set up third stock exchange

Australia's Future Fund develops new investment strategy; Aware Super looking for buyers for agribusiness portfolio; China to launch third stock exchange for small and medium businesses, and crackdown on mismanaged private funds; Kotec to hire asset manager for $130 million domestic bond mandate; Malaysia's EPF makes two senior appointments; SGX allows Spac listings; and more
Insto roundup: Australia's Future Fund announces new investment strategy; China to set up third stock exchange


Australia’s sovereign wealth fund will increase its structural risk profile and target private market opportunities as it develops a new investment strategy.

The Future Fund revealed its plans in a paper released on Monday (September 6) that said its “future investment programme” will have priorities such as an increased risk profile, less liquid assets, inflation-hedging and defensive private market opportunities, and more focused strategies particularly in private markets and debt.

The new approach is driven by paradigm shifts that have reshaped the investment order including deglobalisation, climate change, changes in inflationary regime, the decline of sovereign bond duration and challenges to corporate earnings.

The fund had hinted had a new strategy involving a higher risk profile and a shift towards more illiquid and private investments during its annual report launch in August.

Source: Future Fund

Aware Super’s Lake Boga agribusiness portfolio, which includes some of Victoria state’s largest farms, is reportedly up for grabs.

The A$150 billion ($111.49 billion) superannuation fund has hired advisory firm PwC to help find a buyer. The assets were owned by VicSuper which merged with First State Super to form Aware.

Potential buyers include Canada’s Ontario Teachers’ Pension Plan, Sydney-based Roc Partners and Macquarie’s alternative asset manager Mira.

Source: Australian Financial Review


China has announced plans for a third stock exchange based in Beijing to support fundraising and investing in small- and medium-sized businesses.

The decision was announced in a speech by Chinese President Xi Jinping during a trade fair held in the country’s capital from September 2 to 7 but no elaborations on the plan were shared.

The China Securities Regulatory Commission followed up shortly after with a published statement that said the regulator was excited about the new prospects. 

Source: CSRC

China's banking and insurance watchdog issued a draft guideline on Friday (September 3) aiming to improve its regulation over insurance group companies to prevent financial risks.

The CBIRC is seeking public feedback on the draft and the amendments it makes to a 2010 version of the rules regulating such companies.

Source: CBIRC

China’s Securities Regulatory Commission has vowed to sort through its 60 trillion yuan ($9.28 trillion) fund industry, aiming to eliminate mismanaged and fake private funds.

“China is actively promoting high-quality growth of its capital markets, and healthy development of the 60 trillion yuan fund industry is a crucial part of it,” Yi Huiman, chairman of the country’s securities regulator, told a meeting held earlier this week by the Asset Management Association of China.

Source:  Asset Management Association of China

BNP Paribas is in talks with the Agricultural Bank of China’s (AgBank) wealth unit to form a wealth management joint venture, according to a Reuters report citing unnamed sources.

BNP Paribas is expected to hold majority stakes in the joint venture.

French rival Amundi and US fund giant BlackRock have already formed Chinese wealth management ventures, while Schroders and Goldman Sachs are following suit.

Source: Reuters


The Asian Development Bank is embarking on a study that could lead to a programme to shut down coal-fired plants in some Asian countries.

The initiative, known as the Energy Transition Mechanism (ETM), is expected to be launched by early next year. The lost output from the ETM will be replaced by new renewable energy sources.

"Legacy coal-fired power plants constitute the single largest source of greenhouse gas emissions from human activity. Without addressing them, we will miss the Paris Agreement targets on controlling emissions," Toru Kubo, director of energy with the ADB’s Southeast Asia Department, says in an interview with Asia Asset Management.

The ETM is a mechanism that will support the transition from coal to clean energy, delivered by creating country-based fund structures, he says. "Concessional funds from the development community, developed countries, and philanthropies will be blended with investments from public and private sector entities.”

Source: Asia Asset Management


Nippon Life Insurance has made its first foray into green loans with 2.58 billion yen ($23.5 million) lent to a local real estate investment trust and a shipping company, it announced on August 30.

The insurer lent 2 billion yen to Tokyo-listed REIT, Japan Logistics Fund, to acquire buildings and pay for renovations under the fund’s green finance framework and extended a 575 million yen loan to shipping company IINO Kaiun Kaisha to refinance construction projects.

Source: Nippon Life Insurance


Korea’s quasi-government technology financing agency Korea Technology Finance Corporation (Kotec) is looking to hire an asset manager for a 150 billion won ($129.6 million) domestic bond discretionary mandate, which could be increased to 200 billion won.

The manager will be appointed for one year starting October 2, KOTEC says in its request for proposal published on the website of the Korea Financial Investment Association on August 30.

Source: Asia Asset Management


Malaysia’s Employees Provident Fund (EPF) announced two senior appointments on Friday (September 3).

Sazaliza Zainuddin was appointed chief operation officer, effective September 1. She replaced Mohd Naim Daruwi, who retired after almost three decades with the pension fund. Zainuddin joined EPF and was most recently chief financial officer (CFO).

Replacing him is Mohamad Hafiz Kassim, who took on the CFO role on August 1. He joined EPF in 2008 and was most recently head of the real estate investment department.

Source: EPF press release

Bank Negara Malaysia announced it had teamed up with central bank peers Monetary Authority of Singapore, Reserve Bank of Australia and South African Reserve Bank (SARB), as well as Bank for International Settlements Innovation Hub to test the use of central bank digital currencies (CBDCs) for international settlements.

The initiative, known as Project Dunbar, aims to develop prototype shared platforms for cross-border transactions using multiple CBDCs. It expects to publish its results in 2022.

Source: Bank Negara Malaysia press release


Singapore Exchange (SGX) released a framework that would allow special purpose acquisition companies (Spacs) to list on the bourse. Spacs were allowed to apply for listings on Friday (September 2).

Following a market consultation, the SGX relaxed some measures it had initially proposed, including minimum market capitalisation and limits on shareholder redemption rights.

Singapore’s regulators earlier this year announced they were considering allowing Spacs, after a boom in public listings via blank-check companies in the US in recent months. Spacs raised over $79 billion globally last year.

Source: Singapore Exchange, Financial Times

The Monetary Authority of Singapore became the latest regulator to crack down on crypto exchange Binance by placing the firm's global website on an “investor alert list”.

The regulator warned consumers that Binance is not regulated or licensed to provide payment services in Singapore and said that said the exchange may have breached the country’s Payment Services Act (PSA). 

Binance’s local entity, Binance Asia Services, has applied for a licence and is allowed to operate temporarily. However, the central bank said the local unit should stop transfers of assets to and from its global entity.

Source: Financial Times

Singapore’s GIC launched an $8 billion joint bid for biotech company Swedish Orphan Biovitrum (Sobi) alongside US private equity Advent International.

The joint bid saw Sobi’s share price soar 27%. The deal would be the largest leveraged buyout of a European healthcare company in five years.

Source: Financial Times


Taiwan’s life insurance companies’ total revenue soared to a record NT$304.2 billion ($10.98 billion) in the first seven months of 2021, driven by investment returns.

Combined revenues of the 22 registered life insurers more than doubled from NT$150.5 billion in the same period last year, and surpassed their 2020 total of NT$206.1 billion, according to figures published by the Financial Supervisory Commission.

Their income from investment gains in assets such as stocks and bonds and dividends increased by NT$172.8 billion in the seven months through July from the same period of 2020. The FSC did not disclose the actual total investment income, which accounted for almost 57% of revenues in January-July 2021.

Source: Financial Supervisory Commission; Asia Asset Management

¬ Haymarket Media Limited. All rights reserved.