Insto roundup: GIC invests in HK ESG data startup; Aussie super merger falls through

Australian Catholic Superannuation and NGS Super abandon merger plans; ASX 200 has no all-male boards for the first time; CIC posts 6.82% 10-year net returns; Cambridge Associates applies for licences to conduct business in Hong Kong; Korea's NPS records 7.49% returns for H1 this year; Korea Post seeks managers for ESG stocks mandate; GIC invests in Hong Kong ESG data start-up MioTech; and more
Insto roundup: GIC invests in HK ESG data startup; Aussie super merger falls through


The Australian Catholic Superannuation and NGS Super have scuppered their plans for a merger after the Australian Prudential Regulation Authority (Apra) expressed disapproval for tie-ups between small funds.

Apra deputy chair Helen Rowell had said in May that funds with less than A$30 billion assets under management were uncompetitive and that small funds should merge with larger ones.

The merger of NGS and Australian Catholic would have created a A$23 billion fund. The funds cited regulatory and commercial environmental changes as reasons for the cancelled merger.

An NGS spokesperson also said the Your Future, Your Super reforms had also contributed to the decision.

Source: Australian Financial Review

Two-fifths of superannuation funds are likely to fail the Your Future, Your Super performance test due to high fees and lacklustre returns, an analysis by Super Consumers Australia has found.

Its findings were based on a sample of 42 super funds’ member outcomes assessments, which supers are required to publish.

Every fund gave itself a passing grade, but the consumer body found that the assessments were difficult to find on 69% of the funds’ websites, that 69% of funds made up their own target investment return metric, and 48% identified ways to improve the quality of their products.

Apra will release the results of the MySuper performance test on Tuesday, revealing the country’s worst-performing funds. 

Source: Super Consumers Australia

IOOF, a financial services company that covers financial advice, superannuation and investment products and services, posted a A$143.5 million statutory net loss after tax for the financial year ended June 30.

The loss came primarily from one-off costs associated with the cessation of grandfathered revenues, the firm’s decoupling from the BT platform, and its acquisition of MLC Wealth from NAB bank, IOOF said in a statement on Thursday (August 26).

Underlying net profit after tax was A$147.8 million, the firm stated, which represents a 19% increase from last year.

Source: IOOF

The Australian Securities Exchange (ASX) has hit a milestone for women’s rights as every company in the ASX 200 now has at least one woman on its board.

The final two companies, both mining companies, appointed women as non-executive directors to their boards this month, making it the first time there are no all-male boards in Australia’s top 200 companies.

Women hold 33.6% of ASX 200 board seats as of May 31, a 3% year-on-year increase. This proportion is set to rise as women made up 48% of all board appointments in the first half of 2021.

Source: Financial Standard


China Investment Corporation (CIC) posted an annualised cumulative 10-year net return of 6.82%, 128 basis points higher than its 10-year performance target. 

The firm's overseas investments also posted a net annual return of 14.07%, according to CIC's annual report 2020 released on Friday (August 27).

As of the end of 2020, CIC’s total assets grew to $1.2 trillion, while aggregate state-owned assets under the management of Central Huijin reached Rmb5.19 trillion, up 8.6% from the beginning of the year. Central Huijin is an investment company owned by CIC that provides investments in state-owned banking, insurance, finance, and securities sectors.

Currently, CIC’s global portfolio consists of public equity, fixed income, alternative assets and cash products, respectively accounting for 38%, 17%, 43%, and 2%.

Source: CIC

China's banking and insurance sector regulator is probing Ping An Insurance’s investments in the property market, two people with knowledge of the matter told Reuters on Monday, after the firm took a big profit hit from a soured bet.

The China Banking and Insurance Regulatory Commission has also ordered the insurer to stop selling alternative investment products, which are typically tied to the property market, said the people.

Source: Reuters


Cambridge Associates, a US investment firm with more than $38 billion of assets under management, has applied for multiple licences to conduct business in Hong Kong with an eye on wealthy clients in the Greater Bay Area, according to a senior executive.

The firm is seeking to add the financial hub to its offices in the region in Beijing, Singapore and Sydney to better serve its clients, joining top-tier lenders in the city in the push into the wealth management industry.

“The expansion of our footprint to Hong Kong will allow us to capture the growing opportunities in the development of the Greater Bay Area,” Mary Pang, head of global private client practice at Cambridge, said in a phone interview with South China Morning Post.

Source: South China Morning Post

AIA Group has formed a strategic partnership with investment manager GLP to invest in the global logistics real estate industry and related opportunities.

The insurer said this partnership will enable AIA to leverage GLP's investment experience and expertise in the area. The strategic partnership aligns with AIA's environmental, social, and governance (ESG) strategy by specifically engaging with companies that recognise and incorporate ESG-related considerations into their investment decisions, it added.

Chief investment officer Mark Konyn said: "AIA believes in the strong fundamentals that support the future development of the global logistics real estate market. The alliance is a core part of AIA’s growth strategy to create scalable relationships with world-class investment partners.”

Source: AIA

Index provider MSCI is licensing its MSCI China A 50 Connect Index to the Hong Kong stock exchange for a futures contract.

This will add to the 37 MSCI Asia and emerging-markets futures and options contracts that the Hong Kong Exchanges and Clearing launched last year.

The MSCI China A 50 Connect Index tracks the performance of the 50 largest Chinese stocks across 11 sectors. The new futures licence has to be approved by regulators.

Source: HKEX


National Pension Service, the world’s third-largest pension fund, recorded a 7.49% return in the first half this year, pushing its assets to surpass 900 trillion won for the first time to reach 908.3 trillion won ($780.5 billion).

The return was fueled by global equity investments. Domestic equity contributed 15.6% while foreign equity gained 17.8%, all beating benchmarks.

It also decided to lower the proportion of externally managed overseas bond investments from 50-90% to 40-80% of its total assets managed to save on fees.

Source: NPS; Korea Economic Daily

Korea Post is inviting global asset managers to bid on a 200 billion won (US$172 million) overseas ESG stocks mandate focusing primarily on equity exchange-traded funds.

It will hire up to two managers for three years each, which can be split into 100 billion won each. It is benchmarked against the MSCI ACWI ESG Universal Index, the government postal agency said in a statement on August 23. The mandate is for its insurance unit.

Source: Korea Post; Asia Asset Management


Malaysia’s Employees Provident Fund (EPF) could see net withdrawals this year, as Covid-19-related special withdrawals have already reached RM84 billion – more than the RM78.4 billion in gross contributions received by the provident fund for the whole of 2020.

However, EPF chief strategy officer Nurhisham Hussein, told reporters on Aug 6 that even though the fund anticipated an outflow of RM117 billion from Covid-19-related allowances in 2020 and 2021, the fund did not expect returns to members to be affected.

Nurhisham reportedly said the impact of the withdrawals was the need to carry more cash, but the amount was marginal in relation to the fund’s portfolio returns.

EPF hit its highest quarterly returns in 17 quarters in Q1, after reporting RM19.29 billion gross investment income (RM19.24 billion net).

Source: The Edge Markets


 The Singapore Exchange (SGX) is proposing mandatory climate disclosures to be phased in from next year to bolster companies’ resilience to climate risk.

It is also recommending that companies have a board diversity policy in place and disclose related targets, plans and timelines in annual reports, in order to enhance board diversity.

The regulator wants the climate disclosures to be implemented in phases from the financial years starting January 1, 2022. The proposals are open for public consultations until September 27.

Source: SGX

Hong Kong AI-based ESG data provider MioTech has secured funding led by GIC and Chinese securities firm Guotai Junan International.

The amount invested, which was raised as part of the startup’s series B+ funding round, was not disclosed. Earlier investors include ZhenFund, one of China’s largest venture capital funds; Hong Kong tycoon Richard Li’s Horizons Ventures; HSBC; and Moody’s.

The funds raised will be used to expand and accelerate MioTech’s product development, which centres around sustainability data and solutions for financial institutions, corporations, and individuals, the firm said in a statement.

Source: Miotech


Thailand's Securities and Exchange Commission is proposing new rules for digital asset firms in order to bolster investor protection, including requiring them to deposit clients’ fiat money with banks.

The firms will also have to develop an encrypted automated system that allows customers to withdraw or transfer the digital assets on command, and to ensure clients’ accounts cannot be accessed by others. The accounts must also comply with the principles of decentralised approval authority, multi-sign approval authority, and check and balance.

The regulator is seeking public feedback on the draft proposals until September 22.

Source: Asia Asset Management


MetLife Investment Management, the institutional asset management business of MetLife, and Norges Bank Investment Management (NBIM), the asset management division of Norges Bank, announced the acquisition of One Memorial Drive in Cambridge, Massachusetts for $825.1 million.

The transaction represents the largest single-asset US office transaction to date in 2021.

One Memorial Drive is a 17-storey, Class A office building located on the Charles River with 409,422 square feet of leasable space. 

Source: MetLife Investment Management

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