Insto roundup: CIC’s new Korean joint fund; Apra told to step up oversight
AUSTRALIA
The Australian Prudential Regulation Authority has been ordered to step up its oversight of the A$2.7 trillion ($1.9 trillion) superannuation industry and to do more to clamp down on dodgy practices among industry funds.
A review released on July 17 by the Treasury into the financial watchdog also recommended that the organisation bolster its capabilities to oust inappropriate directors and executives.
Source: The West Australian
Future Super will jump-start an investment programme with an initial commitment of A$200,000 ($140,768) to peer-to-peer lender RateSetter. The funding will be used to facilitate loans through RateSetter’s clean energy coverage for Australian borrowers to buy renewable energy products, such as batteries and panels.
Future Super said this was the first time a retail superannuation fund has been involved in peer-to-peer lending. Adam Verwey, the fund’s founder, said just 7.7% of Australia’s superannuation savings could help enable a country-wide adoption of renewable energy.
Source: The Sydney Morning Herald
CHINA
China Investment Corporation (CIC) will set up a joint fund with Korean banking giant Hana Financial to set up a cross-border fund estimated to hit over W1 trillion ($850 million).
The sovereign wealth fund (SWF) aims to invest in companies seeking to penetrate each other’s markets. Hana Financial is fine-tuning details on the fund formation, which will be the first of its kind to be launched between a Korean financial services firm and a foreign SWF.
Senior CIC officials have met South Korea-based private equity firms – including MBK Partners, IMM Private Equity and BlueRun Ventures – during a recent visit to Seoul, to attract them as co-managers of the new joint fund. They will draw investments from Korean institutional investors.
China's Ministry of Human Resources and Social Security (MoHRSS) and other related authorities will soon complete the transfer of about Rmb660 billion of state-owned assets to the National Social Security Fund (NSSF).
Under the plan initiated in November 2017 in a bid to plug the funding gap in China’s pension system, designated state-owned enterprises (SOEs) must transfer 10% of their equity stakes owned by state bodies such as the Ministry of Finance to the NSSF. The pension fund will then receive investment returns in the form of dividends and will not interfere with the daily operations of SOEs.
Source: MoHRSS
INDIA
An Indian budget proposal to relax the limits on foreign investment in insurance intermediaries would likely boost competition, strengthen distribution capabilities to enhance insurance penetration, and boost M&A in the medium to long term, Fitch Ratings said on Monday (July 15).
The Budget 2019-20, tabled in Parliament on July 5, permits foreign companies to own up to 100% of insurance intermediaries – including insurance agents, brokers, loss assessors and surveyors – from 49%, to attract more foreign direct investment into the industry.
Source: Livemint
Indian renewable energy firm Greenko Group, owned by sovereign wealth funds Abu Dhabi Investment Authority and Singapore's GIC, is meeting investors to raise up to $1 billion in a dollar bond sale, said two people aware of the development, requesting anonymity.
According to one of the sources, the company is looking to refinance debt for a part of its operational assets.
Source: Livemint
JAPAN
Japan's Government Pension Investment Fund (GPIF) has room to invest $26 billion in domestic stocks to keep holdings near its portfolio target of 25% for such assets, according to JP Morgan.
The world’s largest pension fund’s holdings of Japanese stocks fell to 23.6% of its total assets at the end of March, the lowest since March 2017. The weighting may have dropped to 23.3% as of July 5, meaning it could buy about ¥2.8 trillion ($26 billion) of shares if it rebalances in line with its target, according to JP Morgan’s securities unit in Japan.
Source: Bloomberg
KOREA
Korea's National Pension Service is among the instititutions to have made a commitment to a new investment vehicle from Japanese SoftBank’s Seoul-based venture capital unit.
SoftBank Ventures Asia’s W317 billion ($270 million) vehicle will focus on early-stage investments in Asia. SoftBank’s main vehicle is the Saudi Arabia-backed $100 billion Vision Fund that invests in late-stage startups.
Source: Reuters
Kyobo Life Insurance has announced it will foster startups in the healthcare sector as part of its open innovation strategy to find new business opportunities.
Korea’s third largest life insurer has already selected five startups in 10 business categories for the 'Innostage' programme and will pick the other five by the end of this year.
Areas for technology development targeted by the startups include products and services that reward healthy lifestyle behaviour, such as a smart toothbrush to enable dental care and connectivity with insurers, and a system to help improve eating habits based on big data analytics.
Source: Maeil Business News Korea
Korea’s National Health Insurance Service (NHIS) aims to diversify its investment portfolio with a view to boosting returns.
NHIS plans to diversify its investment portfolio by including more aggressive investment vehicles, given that it would be challenging for the insurer to improve its returns with the current investment schemes. These vehicles will include equity funds and alternative funds, while the institution has historically focused on fixed deposits with high stability and liquidity and bond-related investment products.
To this end, NHIS said it had set up a new fund management committee and revised its fund management guidelines.
Source: Maeil Business News Korea
MALAYSIA
Malaysia’s Employees Provident Fund (EPF) has invested A$100 million ($70.5 million) in Dexus Healthcare Wholesale Property Fund, an Australian healthcare real estate fund.
The last commitment to Australia by the $200 billion (€178 billion) Malaysian retirement fund was in 2017. It entered into a joint venture with Malaysian industrial group OSK Holdings to develop a mixed-use project in central Melbourne.
Source: IPE Real Assets
NEW ZEALAND
New Zealand Superannuation Fund has invested an unspecified amount in a N$300 million ($203.2 million) domestic hotel portfolio to tap growing domestic tourism and international arrivals, which contains two properties in Auckland and one in Christchurch.
Will Goodwin, NZ Super’s head of direct investments, said the partnership would provide the fund with exposure to the expanding tourism sector, diversify its investment portfolio and support the industry’s strategic objectives.
Source: NZ Herald
PHILIPPINES
Philippine conglomerate Yuchengco Group is injecting more funds to support the government’s commitment to spend Php9 trillion ($176 billion) on infrastructure projects under the Build Build Build programme, and has encouraged other investors to do the same.
Joji Basa, department head at Malayan Insurance Investment Management, said the Yuchengco-owned company was participating in the Philippine Development Plan after the Insurance Commission issued a circular allowing investment companies to invest in government infrastructure projects.
“With some sort of government guarantee, it benefits investors, since there is a very low probability of default both in the short and long term,” Basa said. "This type of investment is typically less volatile compared to conventional financial market assets, which makes it ideal for long-term investing."
Source: PhilStar.com
SINGAPORE
Singapore sovereign wealth fund GIC and China’s Tencent are among those to have invested in the latest fundraising round of European online bank N26, which raised $170 million from existing investors, putting a value of $3.5 billion on a company.
Other investors included Peter Thiel’s Valar Ventures and Allianz X, the digital investment unit of German insurance group Allianz. It means Europe’s most valuable fintech company has seen its market worth rise by $800 million in just six months.
Source: Financial Times
Singapore's GIC is among the organisations considering bids for a stake in the $6.4 billion European settlements giant Euroclear, according to people familiar with the matter.
The Brussels-based company is planning to decide in the coming days whether to pursue a stake sale or an initial public offering of the business, said people who asked not to be identified.
Source: Bloomberg
GLOBAL
Institutional investors from Asia, as well as Europe, the Middle East and the US, have made commitments to Alcentra’s new European-focused direct lending fund, said the London-based asset manager.
The BNY Mellon subsidiary announced on July 22 that it had closed the fund at €5.5 billion ($6.17 billion), nearly double its €3 billion minimum target.
Source: Alcentra, Financial Times
The $30.4-billion Texas County & District Retirement System has approved commitments worth $95 million into three private equity vehicles under two China-based firms, according to a disclosure.
Source: Deal Street Asia