Weekly investor roundup: KIC advised to consider Europe housing; GPIF to exclude Chinese sovereign bonds
TOP NEWS OF THE WEEK
Government Pension Investment Fund (GPIF) has decided not to invest in Chinese government bonds for now, even as it is included in the FTSE World Government Bond Index (WGBI), GPIF’s foreign bond benchmark, a spokesperson told AsianInvestor.
From October onwards, the fund will exclude Chinese government bonds from the benchmark.
GPIF President Masataka Miyazono cited reasons that included settlement and liquidity issues in the Chinese market, according to his remarks released on September 29 during a board meeting in late July.
The spokesperson said the growing concern over Chinese property developer Evergrande, and the overall risks of Chinese debt as well as the stability of China’s financial system, are not part of the reasons behind the decision.
HSBC and Temasek have announced a new partnership to establish a debt financing platform dedicated to sustainable infrastructure projects with an initial focus on Southeast Asia.
HSBC and Temasek will invest up to a combined $150 million to catalyse financing of marginally bankable sustainable infrastructure projects, according to a release on September 30.
The platform seeks to scale up to $1 billion of loans within five years to support commercial developments in the region’s sustainable infrastructure sector.
The Asian Development Bank and Clifford Capital Holdings will support the platform as strategic partners.
Korea Investment Corporation, among other Korean institutional investors, has been advised to consider investing in high-quality European rental housing projects in partnership with local firms, as they have stronger growth potential than the US market upon economic recovery, KIC released on Wednesday.
London-based real estate investment manager Tristan Capital Partners made the remarks during an online conference hosted by KIC between Korean institutional investors and London financial institutions.
Three of Permodalan Nasional Bhd’s (PNB) funds will be giving out an income distribution payout of RM650.73 million ($155.89 million) for the financial year that ended on September 30, 2021.
Amanah Saham Malaysia 3 (ASM 3) will be responsible for the largest proportion (RM593.04 million) of the payout after recording a net realised income of RM653.27 million- an increase of 17.87% from last year.
The other two funds posted 4.04% and 11.46% returns. All three funds outperformed benchmarks, PNB said.
Source: The Edge Markets
Two European pensions funds have entered an agreement to purchase a 62% stake in the largest timber producer in Otago in New Zealand.
APG Asset Management and the UK's Pension Protection Fund (PPF) will purchase the shares from Sinotrans New Zealand. The remaining 38% will remain with New Forest’ Australia New Zealand Forest Fund 2.
Wenita is made up of 30,000 hectares of sustainably managed forests and is recognised as one of the premier softwood plantation assets in New Zealand.
Source: Financial Standard
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The government-owned Queensland Investment Corporation posted A$6.7 billion ($4.88 billion) in investment returns for the financial year that ended in June, led by rising markets and the global economic recovery.
QIC manages A$92.4 billion for the Queensland government, and domestic and international clients.
The firm also highlighted that its long-term diversified fund, which caters to universities and local governments, achieved an 18.3% return before fees.
QIC actively manages portfolios across infrastructure, real estate, private debt, liquid markets and private equity, the statement wrote.
Neuberger Berman is the latest overseas firm to gain regulatory approval for a wholly-owned mutual fund business in mainland China.
Following in the footsteps of BlackRock and Fidelity, Neuberger Berman is the third overseas fund manager to be approved by the China Securities Regulatory Commission.
The new business will be called Neuberger Berman Fund Management and will be based in Shanghai with starting capital of Rmb150 million ($23.2 million). Under the terms of the CSRC approval, Neuberger Berman will be allowed to operate and distribute public and private investment funds in mainland China.
Source: Neuberger Berman
Hong Kong-based Raffles Family Office led a fundraising round for local biotechnology company Cellomics, which drew investors including locally-listed Hong Kong-listed Jacobson Pharma and Shenzhen-listed Sinocare.
The multi-family office did not disclose how much money was raised or provide more details.
"Our Cellomics stake further addresses rising interest among our clients in direct investment opportunities, but more importantly lets us showcase the strength of Hong Kong as a hub for new ideas," Kwan Chi Man, co-founder and group chief executive officer of Raffles Family Office, said in a statement on September 24.
Source: Raffles Family Office
Nippon Life Insurance has invested NZ$141 million ($98 million) in a green bond issued by the World Bank to be used mainly for climate funds to support the transition of developing countries to a low-carbon society.
This is the first time for Nippon Life to invest in a green bond of such objectives, it said in an announcement on Thursday.
Source: Nippon Life Insurance
The Bank of Korea (BOK) announced on Sept 28 to exclude high carbon emitters or those with poor ESG scores in its foreign currency assets within three years through negative screening.
The process will begin with its outsourced foreign reserves and expand to all foreign currency assets within the next two to three years, the central bank said.
Construction Workers Mutual Aid Association (CWMA) will commit $25 million to Paris-based private equity firm Ardian for infrastructure investments, according to French media.
The $4 billion savings fund for Korean construction workers has awarded its infrastructure investment mandate to Ardian's secondary fund of funds, which targets an internal rate of return (IRR) of 12-15%, the Financial News reported on Thursday.
Source: The Korea Economic Daily; Financial News
Military Mutual Aid Association (MMAA) plans to raise allocation to overseas stocks to 50% from current the 42%, and increase investments in ESG, future mobility and bio assets.
The fund will also expand investments in exchange-traded funds (ETFs) and ETF-managed portfolio (EMP) funds, Chief Investment Officer Lee Sang-hee told Korean media Maeil Business Newspaper in an interview.
Source: Maeil Business Newspaper
Malaysia’s Employees Provident Fund (EPF) has invited tenders from insurers to protect its members’ contributions from Covid-related losses.
The tender process will close on October 12 and marks the first time the pension fund has issued such a tender, The Edge Markets reported.
Source: The Edge Markets
Kwap sold off 1 million Maybank shares on Wednesday (September 29), leaving it with 543.11 million shares or 4.63% direct interest in the bank.
The fund also has 44.03 million shares or 0.38% indirect interest in Maybank.
Source: The Edge Markets
Temasek will acquire a 40% stake in Mumbai-based healthcare firm Integrace for Rs 540 crore ($72 million).
The state investment firm has signed an agreement with Indian private equity firm True North which held a significant majority stake in the therapy-focused company, which offers care for musculoskeletal disorders and pain management.
Source: The Economic Times
Hong Kong’s Link Reit is in talks to acquire half stakes from Singapore’s GIC for three prime CBD assets in Sydney - the Queen Victoria Building, the Strand Arcade and The Galeries.
The deal is worth around $550 million, the Australian Financial Review reported.
Source: Australian Financial Review
Taiwan’s Public Service Pension Fund (PSPF) reported a 600% year-on-year surge in investment income in the first seven months of 2021 on the back of the local stock market bull run led by chip manufacturers.
The pension fund’s investment income in January through July was NT$56.89 billion ($2.05 billion) versus NT$8.38 billion in the first seven months of 2020, and its return jumped to 8.52% from 1.45% last year.
“The coronavirus impact on Taiwan equities has been marginal thus far this year. Taiwan’s stock market has performed better than most emerging-market equities,” PSPF says in a statement on September 27. “The fund rebalanced its portfolio accordingly based on the market trend.”
Source: Asia Asset Management; PSPF
The Asian Infrastructure Investment Bank is committing $90 million to an infrastructure fund set up by Aberdeen Standard Investments and Bahrain-based alternative asset manager Investcorp.
The Aberdeen Standard Investcorp Infrastructure Partners’ Fund will focus on investment opportunities in the healthcare, education, water, mobility and digital infrastructure of the Gulf Cooperation Council and the broader Middle East and North Africa region, Investcorp said on Monday.
The company did not disclose the size of the fund.
Source: The National News
The Louisiana State Employees' Retirement System has committed $100 million to Baring Asia Private Equity Fund VIII. The $13.9 billion pension fund's board approved the commitment to the Asia-Pacific buyout fund managed by Baring Private Equity Asia at its August 26 meeting.
The move marks the fund's second commitment to the Asian fund manager. The pension fund previously committed $100 million to Baring Asia Private Equity Fund VII in 2018.
As of June 30, the actual allocation to private markets was 19.7%.
The Arkansas Teacher Retirement System has committed a total of $550 million to 11 investment funds at its board meeting on September 27, as confirmed by Rod Graves, deputy director of the $21.2 billion pension fund.
One of the investment funds was LaSalle Asia Opportunity VI, a pan-Asian opportunistic real estate fund, to which the pension fund's board agreed to commit $50 million.
Other major commitments included $95 million to Juniperus Insurance Opportunity Fund; $70 million each to two open-end real estate funds: Morgan Stanley Prime Property Fund and RREEF Core Plus Industrial Fund; $55 million to LBA Logistics Value Fund IX; $50 million to Chatham Asset Private Debt and Strategic Capital Fund III, and $40 million to Almanac Realty Securities IX.
The fund commitments were made at the recommendation of the board's investment consultant, Aon Investments USA.
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