AUSTRALIA

Naomi Edwards, the chairwoman of the newly created Spirit Super, criticised funds engaged in pseudo-mergers for not delivering good outcomes for members.

The A$23 billion ($17.6 billion) Spirit Super is the product of a merger between Tasplan and MTAA Super – one of many mergers that are occurring across the superannuation industry in Australia. Edwards did not name any supers but said “the best mergers for members are complete and absolute mergers”.

Some supers have come up with innovative “pseudo-mergers. For example, Maritime Super and Hostplus share a pooling arrangement that allows Hostplus to make investment decisions over their pooled monies. However, questions have risen over Maritime Super continuing to pay millions in salary to executives who are leaving investment decisions to another fund’s leaders.

Source: Australian Financial Review

INDIA

India’s quasi-sovereign fund National Investment and Infrastructure Fund (NIIF) invested Rs21 billion ($286 million) in Bengaluru-based hospital chain Manipal Hospitals through its private equity Strategic Opportunities Fund (SOF). This marks SOF’s first investment in the Indian healthcare sector.

Manipal operates 15 hospitals across India, with a focus on tertiary and quaternary care. Among its other investors are private equity firm TPG Capital, which acquired a 22% stake in 2015, and Singapore state investor Temasek, which acquired an 18% stake in 2017.

NIIF manages close to $4.5 billion across the SOF, an infrastructure-focused master fund, and a fund of funds and is backed by Abu Dhabi Investment Authority and Temasek.

Sources: Mint, Business Standard

Dutch development bank FMO committed $137 million to Indian joint venture EverSource Capital’s Green Growth Equity Fund (GGEF). GGEF invests in green infrastructure projects in India, such as clean energy, transportation, resource efficiency and energy services. It is seeking to raise up of $940 million in equity.

India’s National Investments and Infrastructure Fund (NIIF) and the UK’s Department for International Development are anchor investors in GGEF. In July 2020, UK oil and gas company BP announced a $70 million investment in GGEF.

EverSource Capital is a joint venture between Indian private equity firm Everstone Capital and solar project developer Lightsource BP.

Source: Mint

INDONESIA

The CEO if Indonesia’s new sovereign wealth fund, the Indonesia Investment Authority (INA), said it would avoid the same mistakes committed by Malaysia’s 1MDB.

In an interview, Ridha Wirakusumah said, “The whole sovereign wealth fund world knows of what not to do because of one example,” referring to the corruption scandal that embroiled Malaysia in 2015.

INA is hoping to crowd in foreign investment to support much-needed infrastructure development projects. The United Arab Emirates recently confirmed a $10 billion commitment to the fund. Indonesian authorities previously claimed INA had raised capital from global institutions such as U.S. Development Finance Corporation, Japan Bank for International Cooperation, and Caisse de dépôt et placement du Québec

Source: Financial Times

JAPAN

Japan’s Government Pension Investment Fund, the world’s largest pension pot, considers the impact of its investments on markets and isn’t distorting the country’s stocks, said Hirohide Yamaguchi, the newly appointed chairman of the fund’s board of governors.

Yamaguchi, a former deputy governor of the Bank of Japan, said also that it was important to look at the fund’s long-term returns, rather than focusing on the short-term. He spoke in Tokyo at his first press conference since taking the role last week.

The GPIF held ¥45 trillion ($407 billion) in domestic stocks at the end of 2020, or about 6% of the entire market. Until recently, the fund was the single largest holder of Japanese shares, before being surpassed surpassed by the Japanese central bank. 

Source: Bloomberg

Japanese life insurers are considering buying foreign bonds again after a record selling spree, as US Treasuries’ yields have bounced back close to their comfort levels.

Executives at the country’s top four insurers, which manage more than $1.6 trillion in assets, told Reuters US bonds are becoming attractive at yields near 2%. A return of the long-term investors could help stabilise a market facing pressure from upbeat economic sentiment and concerns about inflation.

The 10-year U.S. Treasury yield rose to a 14-month high of 1.776% earlier this week from around 0.90% in December. The Japanese insurers expect the 10-year Treasury yield to test 2% in the coming months.

Source: Reuters

KOREA

The National Pension Service (NPS) is set to introduce tighter environmental, social and corporate governance (ESG) criteria for companies that it seeks to invest in.

Under the tightened screening measures, the nation's largest pension fund will stop investing in any listed firm if it is found to have any problems involving the criteria. NPS is set to introduce the move as early as the first half of the year. Details of the tightened screening measures have not been fixed yet. NPS considered adopting such a strategy in 2019, as part of its bid to expand socially responsible investments.

Also known as "negative screening," the toughened criteria will be used by the NPS to avoid investing in so-called "bad companies" that do not meet social and environmental standards. The term contrasts with "positive screening" under which investors focus on expanding investments in companies that contribute to favorable social and environmental changes.

Source: Korea Times

MALAYSIA

Sovereign wealth fund Khazanah sold its stake in loss-making semi-conductor manufacturer SilTerra for RM273 million ($66 million).

Following the transaction, which is expected to be completed by the end of the second quarter of 2021, Malaysian trade facilitation and energy company Dagang NeXchange and Chinese private equity investor CGP Fund will own 60% and 40% of Silterra, respectively.

SIlterra was established in 1995 by the government of Malaysia to push the semiconductor manufacturing industry.

Source: The Edge Markets

MYANMAR

International asset owners are questioning the exposure of key portfolio companies to Myanmar, following the coup by the military on February 1. Park Yoo-kyung, an adviser of the Dutch pension fund, APG, which manages $668 billion, raised questions about Korean steel firm Posco's commitments to responsible investments, saying many investors are putting pressure on the company.

In addition, Sweden's public pension fund, another shareholder in Posco, asked the firm about its investments in Myanmar due to its concern for human rights abuses in the country. In addition, Helsinki-based financial group Nordea told the Swedish arm of Oxfam's Fair Finance Network that it had put Posco "in quarantine until further notice," due to its ties in Myanmar.

Posco said that its subsidiary Posco Coated & Color Steel has not paid dividends since 2017 to Myanmar Economic Holdings, which is under control of the junta. The steel company is reportedly reconsidering its partnership with MEHL, which owns a 30% in the steel plate manufacturer.

Sources: Financial Times, Reuters, Korea Times

NEW ZEALAND

The Guardians of New Zealand Superannuation, which manages the NZ$55 billion ($38.8 billion) NZ Super Fund, appointed Paula Steed has as general manager of finance and investment operations, Mark Fennell as general manager of risk, and David Sara as general manager of technology.

The three roles are newly created after Stewart Brooks, general manager of finance and risk decided to retire. "His decision provided an opportunity to consider the leadership team structure in order to bolster the voice of risk and to increase our focus on technology and data," a spokesman told AsianInvestor.

In her new role, Steed will oversee the company’s finance, tax, internal audit and investment operations team.  She is currently chief internal auditor at ASB Bank and was previously chief financial officer at UDC Finance and division financial controller at ANZ.

Fennell will be responsible for the risk, data services and records management teams. He has been general manager for portfolio completion since 2012, and has been with the fund since 2007 when he joined as chief operating officer. A replacement will be made for Fennell’s current role.

Sara is currently general manager of operatons and has been with the fund for 11 years. All three will take up their posts on July 5.

Source: NZ Super

THAILAND

The government of Thailand approved in-principle plans to set up a new pension fund, a spokeswoman announced on March 30.

All employees not currently participating in other pension plans will be required to participate in the new scheme, which is being introduced in response to Thailand’s aging population. Thailand is expected to see around one million additional retirees every year from 2023.

The scheme, which is yet to be approved by parliament, would see employees and employers contributing between 3%-10% of salaries.

Source: Bloomberg 

INTERNATIONAL (EX-ASIA)

 

The UK's pensions regulator will consider enforcement action against pension schemes who do not make mandatory climate risk disclosures, it said on Wednesday (April 7).

The Pensions Regulator said it was calling on scheme trustees to protect pensions savers from climate risk, ahead of proposed regulations requiring trustees of larger schemes to keep track of their climate change exposure.

“Where we do not see schemes complying with the rules, we will consider enforcement action," David Fairs, the watchdog's executive director of regulatory policy, analysis and advice said in a statement. 

Source: Yahoo! Finance