Insto roundup: Poba seeks JVs; GPIF calls for alts experts
AUSTRALIA
Future Fund has said it wants to invest more into technology start-ups in China but noted that the heightened trade tensions between the US and China are a complication.
Wendy Norris, deputy chief investment officer of private markets for Future Fund, said the growth of the Chinese private equity space was “phenomenal” since 2017.
However, Norris noted that the trade tensions had an “enormous impact” on the fund's ability to deploy capital. “The issues over the ... protection of intellectual property are going to change the flows of capital and the flows of information between the US and China," she said.
“That is going to play out in a way that fundamentally impacts the growth of technology markets in the future,” Norris added.
Source: Australian Financial Review
Future Fund has taken part in a $52 million D-series funding round for Eargo, a California-based healthtech firm.
Existing investors of the funding round for the manufacturer of hearing aids include Nan Fung Life Sciences and New Enterprise Associates.
Eargo will be using funding from the round to further its product innovation, increase awareness of hearing loss and drive growth in the domestic market.
Source: Deal Street Asia
CHINA
The International Monetary Fund (IMF) can now access the onshore China market as it has obtained approval from the China Securities Regulatory Commission (CSRC) to become a renminbi qualified foreign institutional investor (RQFII).
The institution will need to follow that up with approval from the State Administration of Foreign Exchange for an investment quota.
Source: CSRC
Nine provinces will start handing over investment mandates this year to the National Council for Social Security Fund (NCSSF) to manage their pension assets.
The nine provinces are Hebei, Jilin, Jiangsu, Zhejiang, Anhui, Fujian, Henan, Guangdong and Qinghai. By the end of 2018, nine provinces (and regions) had transferred part of their pension assets to NCSSF to ensure those assets are better managed.
Source: Xinhua
INDIA
The insurance regulator is set to revamp rules governing unit-linked insurance plan (Ulip) schemes for the first time in seven years, according to a media report.
The Insurance Regulatory Development Authority of India (Irdai), is likely to change the rules for other pension plans and traditional products as well. It is likely to relax norms on buying annuities after the accumulation phase, end the requirement of minimum capital guarantees, and allow policy holders to make partial withdrawals on their pension plans, the report said.
Source: The Economic Times
JAPAN
Government Pension Investment Fund is looking for one or more external consultants to advise strategies for investing in alternative assets as it seeks to raise exposure to non-traditional assets, according to a statement on its website.
The consultants will be responsible for formulating the fund’s medium- and long-term investment strategies in alternatives, GPIF said in a statement on March 6. Applications are open until March 28.
According to its medium-term plan released in 2015, the world’s largest pension fund aims to allocate up to 5% of its total assets to alternative investments between 2015 and 2019 (fiscal year). Alternative investments made up 0.21% of the fund’s assets at the end of 2018.
Source: Asia Asset Management, Deal Street Asia
Institutional investing could benefit greatly from artificial intelligence, but the industry has been too slow in adopting the technology, according to Hiromichi Mizuno, executive managing director and chief investment officer of Japan's ¥150.6 trillion ($1.34 trillion) Government Pension Investment Fund.
Mizuno made the comments at the Council of Institutional Investors spring conference in Washington.
Mizuno referred to GPIF’s own attempt to lead by example: in November 2017, GPIF partnered with Sony Computer Science Laboratories to study the impact of AI on asset management.
Source: Pensions & Investments
MALAYSIA
Khazanah may need to drop some underperforming companies to save the sovereign wealth fund from incurring more losses, Prime Minister Mahathir Mohammad has said.
He also said the SWF needs to draw up a comprehensive action plan to ensure it can stem and reverse its financial losses.
Earlier this month, Khazanah announced that half of total impairment costs of RM7.3 billion ($1.8 billion) in 2018 was accounted for by the RM6 billion injected into Malaysia Airlines, which Khazanah took over in 2014.
The New Straits Times also reported that the flag carrier's days may be numbered as it had failed to meet its three-year target to become profitable.
Instead, Malaysia Airlines had been continuing to make losses since it was privatised in 2014.
Source: New Straits Times
State pension fund Kwap is seeking to revive a RM3.5 billion ($856 million) project by offering to lower the cost to the government, according to people familiar with the matter.
Kwap is asking the government to bring back a project to build an immigration control system that was awarded to Prestariang, said the people, who asked not to be named as the talks are private.
The pension fund for civil servants holds a stake in Prestariang, whose shares have lost 73% in the past year.
Representatives for Prestariang and Kwap, the country’s second-largest pension fund, declined to comment.
Source: The Edge; Bloomberg
SINGAPORE
GIC will invest 50 billion rupees ($700 million) in Bharti Airtel, marking its third-biggest bet on an Indian company and boosting the Indian telecom operator’s capital amid stiff local competition.
GIC joins investors from Japan to Canada in pumping money into Airtel and its group companies to help cut its debt and fight off competition from billionaire Mukesh Ambani’s Reliance Jio Infocomm.
Billionaire Sunil Mittal-led Bharti Airtel said in a stock-exchange filing that GIC’s investment will be part of a 250 billion rupee rights issue to shareholders in which its promoters -- Bharti Group, Bharti Telecom and Singapore Telecommunications (Singtel) -- will participate as well.
Singtel’s effective interest in Airtel will be 35.2% after the completion of the rights issue. It will remain the single-largest shareholder in the Indian telecom operator.
Source: AsiaTimes; VCCircle
ST Telemedia, a unit of Temasek Holdings, has launched a start-up to help Asian companies adopt artificial intelligence and cloud technologies.
The start-up, called Leap, has grown its team to 60 AI and cloud professionals since it was established 10 months ago. It has operations in Singapore, Malaysia and Indonesia, and aims to double its staff by the end of this year.
"It is a start-up but with an access to capital and assets that are untypical of a start-up," Leap chief executive officer Ron Totton said, adding that it is ambitious and wants to scale up through organic growth and mergers and acquisitions.
Source: The Straits Times
SOUTH KOREA
National Pension Service (NPS) plans to become more conservative in running its local equity portfolios while being more bullish on overseas markets in 2019.
The pension fund cut the target active risk for local stocks from 1.07 last year to 0.95 this year, while raising that for overseas stocks from 2.02 to 2.12, according to sources from the financial and investment industry, citing a report on active risk allocation for each asset class presented to the fund’s top decision-making body, the fund management committee, earlier this year.
Active risk is a type of risk taken to outperform a benchmark and create higher returns. Low active risk indicates an investment portfolio closely follows its benchmark, while high active risk means the portfolio deviates from the benchmark quite significantly.
The world’s third-largest pension fund, managing W638.8 trillion ($566.7 billion) in assets as of last year, recorded a 17% loss in Korean stocks in 2018, according to the fund. In contrast, foreign equities lost 6.2% in the same period.
Source: Pulse
Public Officials Benefit Association (Poba) will continue to step up investment in US real estate loans through joint ventures with global pension funds, while cutting its allocation to equities, said its chief investment officer Dong-hun Jang.
The $11 billion South Korean retirement fund for local government employees launched joint ventures with California State Teachers' Retirement System and Teacher Retirement System of Texas last year to invest in US mortgages. Now it is considering setting up new joint ventures with other global pension funds.
Jang said that he prefers sourcing deals through such ventures and separately managed accounts, instead of buying 'sell-down' assets from domestic investment companies because of relatively low risk-adjusted returns.
Source: Korean Investors
Kyobo Life Insurance, South Korea's third-largest life insurance firm, has denied rumours that chairman Shin Chang-jae is considering selling his and the stake of other financial investors to a Korean banking group.
“The stake sell-off rumours are totally unrealistic, because a company official’s negotiations with banking groups are potentially a breach of trust,” the insurer said in a statement.
According to news reports, Kyobo Life representatives have been in talks with KB Financial Group and Hana Financial Group to transfer stakes owned by Shin and some foreign shareholders, including Affinity Equity Partners and Corsair Capital, while abandoning plans for an initial public offering.
Source: The Investor
Hana Alternative Asset Management, part of a South Korean banking group, has appointed Hee-seok Kim, a former global investment head of the National Pension Service, as its new chief executive officer.
The appointment is part of efforts to expand NPS's investment portfolio into a broader range of overseas markets.
Kim will join later later this month, according to local media reports. Kim headed the investment strategy and global alternative investment divisions of NPS during his stint from 2004 to 2011.
Source: Korean Investors
Kyobo Life Insurance has appointed Yun Your-hyun as its chief operating officer, marking the first time the position has been filled since 2013.
Yun will primarily focus on boosting insurance sales. He is the second-in-command at the insurer, reporting to chairman Shin Chang-jae.
The position has been lying vacant since 2013, when Shin Yong-kil, currently chairman of the Korea Life Insurance Association, ended his stint, the Korea Times reported. Shin had joined Kyobo in 2008.
Source: Insurance Business Asia
THAILAND
AIG has appointed Isorasak Thesratanavong as chief executive officer of its Thai unit, effective March 1.
He succeeds Tomi Latva-Kiskola, who has been appointed president and CEO of AIG Hong Kong and Macau, and head of country operations for Hong Kong and Taiwan.
Based in Bangkok, Thesratanavong reports to Sachin N. Shah, Asia-Pacific CEO of AIG General Insurance. Before joining AIG, Thesratanavong was chief executive of Direct Asia Thailand since January 2018.
Source: Insurance Business Magazine
INTERNATIONAL
Allianz Real Estate, the property investment arm of German insurer Allianz, posted a 58% rise in its Asian assets to €3 billion ($3.3 billion) last year, far outpacing the growth of its global AUM.
Its Asian assets grew from €1.9 billion at end-2017, helping push its total portfolio up 13% to €63.5 billion at end-2018 from €56.4 billion a year earlier. The total includes a lending book of €19.3 billion.
Asia now accounts for 6.8% of Allianz RE’s €44.2 billion in property equity investments, up from 4.5% early last year. This is in line with the plan to raise its Asia allocation to 10%, as outlined in March last year to AsianInvestor by Rushabh Desai, Asia-Pacific CEO of Allianz Real Estate.
Reliance Capital, an Indian financial services giant, has begun talks with large institutional investors and asset managers about selling its 42.88% stake in Reliance Nippon Life Asset Management (RNAM).
The asset owners in question include sovereign funds Abu Dhabi Investment Authority, Canada’s Ontario Teachers’ Pension Plan and Singapore-based Temasek, as well as private equity firms Blackstone and The Carlyle Group.
RNAM’s Japanese partner, Nippon Life Insurance, has the “first right to offer” on the stake, but Reliance Capital can choose to ignore it if an offer from a third party is more attractive.
Anil Ambani, the chairman of Reliance Group, is struggling to pay off mounting debts, hence his move to offload the holding.
Source: Business Standard