Weekly Digest: Temasek's $10bn plan for India; INA inks deal with UK entity
TOP NEWS OF THE WEEK
Singapore’s Temasek Holdings is planning to allocate up to $10 billion to India over the next three years, according to a report by Bloomberg.
The company is expected to deploy that capital into a range of partnerships and public equities, the report said, citing Ravi Lambah, its head of India and its investment group.
It is investing in banks and finance sector businesses, healthcare, technology, industrial assets and consumer markets, Lambah said. It is also considering its options in decarbonisation and energy transition investments.
Source: Bloomberg
The Indonesia Investment Authority (INA), Indonesia’s sovereign wealth fund, and British International Investment, a UK development finance institution and impact investor, have announced a strategic partnership to foster sustainable economic development and cooperation.
The partnership, formalised through an investment framework agreement, will focus on green infrastructure, renewable energy, climate resilience and adaptation, and related sectors.
INA has designated green energy and transformation as a priority investment target.
Source: Indonesia Investment Authority
OTHER INVESTMENT NEWS
CHINA
China's National Financial Regulatory Administration (NFRA) on July 21 issued a draft on easing rules on foreign investment in asset management businesses as part of efforts to attract overseas investors.
The NFRA is soliciting public opinion until Aug 21. It proposes the removal of restrictions for overseas non-financial institutions to invest in financial asset management firms.
The draft also planned to abolish the total asset requirement for overseas financial institutions wanting to invest in financial asset management firms. Multinationals would also be allowed to directly initiate the establishment of foreign-funded financial companies under the draft rules.
Source: National Financial Regulatory Administration
HONG KONG
Mandatory Provident Fund (MPF) recorded estimated net fund inflows of HK$13.2 billion for the second quarter and HK$28.4 billion ($3.6 billion) for the first half of 2023, approximately 5.4% higher than the historical year-to-date average of HK$27 billion over the past three years.
Despite being MPF’s worst-performing asset class for the second quarter and first half of 2023, Hong Kong and China equity funds were the biggest absolute inflow winner reporting a respective net inflow share of 23.1% and 28.8%.
The Default Investment Strategy (DIS) Core Accumulation Fund is now MPF’s fastest-growing asset class, attracting net inflows equivalent to approximately three times its market share for the last three months while ranking second in year-to-date absolute inflows.
Source: MPF Ratings
Hong Kong can attract a lot more insurance companies if the government provides a stable business environment and “limits bureaucracy” in the Greater Bay Area, according to Evan Greenberg, chairman and CEO of Chubb.
“Business is attracted to an environment of certainty,” Greenberg said in an exclusive interview with the Post during a recent visit to the city.
If Hong Kong can offer more “certainty, predictability and transparency”, companies will have more confidence and increase their presence here, he added.
Source: South China Morning Post
JAPAN
Japanese life insurers plan to send more of their $2.7 trillion in investment money abroad, even after surging interest rates prompted them to dump billions of dollars of foreign bonds last year.
That’s according to Hiroshi Shimizu, chairman of the Life Insurance Association of Japan and chief of the nation’s largest insurer by assets. “If we set our eyes globally, there are many good investment opportunities,” he said in an interview.
Shimizu, who is president of Nippon Life Insurance Co., said recent gains in longer-tenor Japanese government bond yields could trigger a return of investment back home to some degree. But with Bank of Japan Governor Kazuo Ueda signaling he’s in no hurry to normalise policy, Shimizu poured cold water on the idea of a big homecoming of insurance money.
Source: Bloomberg
Dai-ichi Life Holdings Inc. has invested approximately Rs3.1 billion ($296 million) investment in Indian insurtech RenewBuy in an ongoing Series D funding round.
The insurtech will use the proceeds to expand its presence across Asia and improve its product stack and technology experience. Last year, RenewBuy tapped Kotak Mahindra Capital to advise on raising $75 million to $100 million.
To date, the insurtech has IIFL Wealth, Amicus Capital Partners, Lok Capital, Apis Partners, and now Dai-ichi Life amongst its backers. RenewBuy was valued at $350 million to $400 million during its last funding round in 2021.
Source: Dai-ichi Life
KOREA
Public Officials Benefit Association (POBA) is looking to hire a private equity manager for an India-focused mandate of an undisclosed value.
Interested managers must be private equity managers registered in Korea, with at minimum of three years in Indian equity investment and a at least W10 billion ($7.8 million) in their Indian equity portfolio.
POBA has hired Korean consulting firm KG Zeroin as investment service provider for the mandate. Deadline for applications is August 1, with the winning firm to be confirmed by August 18.
Source: POBA
The Korean government has filed a suit to reverse an international tribunal's order to pay nearly $100 million in damages to hedge fund Elliott Investment Management in a dispute stemming from the controversial 2015 merger of two Samsung Group affiliates.
Last month, the Permanent Court of Arbitration (PCA) in the Netherlands delivered the verdict in the investor-state dispute settlement (ISDS) suit that the New York-based activist fund filed in 2018, demanding compensation of $770 million from the South Korean government.
Including delayed interest and legal fees, Seoul was ordered to pay US$107.8 million to Elliott.
The legal battle dates back to 2015, when the state-run National Pension Service (NPS) approved the merger of Samsung C&T Corp. and Cheil Industries Inc., a move widely seen as intended to tighten Samsung heir Lee Jae-yong's control over the family-controlled group, as his father Lee Kun-hee had suffered a heart attack the previous year.
Source: Yonhap News Agency
Korean insurance companies will be allowed to acquire non-insurance subsidiaries in overseas countries as early as the second half of this year.
The move is part of policy directions announced by the Financial Services Commission (FSC), the country's top financial regulator, aiming to strengthen local insurers' global competitiveness and foster long-term growth potential.
The FSC decided at its eighth deregulation meeting that local financial companies, including insurers, will have more autonomy in their acquisitions of non-insurance firms in foreign countries and more leeway in sending capital to overseas subsidiaries.
Source: The Korea Times
MALAYSIA
The Private Pension Administrator Malaysia (PPA) is urging Employees Provident Fund (EPF) members to think about joining its private retirement schemes (PRS) to grow their retirement nest eggs, according to a report by local media outlet The Sun Daily.
PPA chief executive Husaini Hussin said, “Savings in EPF alone were not enough”, according to the report.
“PRS are designed for retirement,” he said. “In your financial planning, you have a few jars, if you’re already an EPF member, then you have an additional one such as [a private retirement scheme] ... you need to have different investment jars to save for retirement.”
PPA is a body tasked with protecting private retirement schemes and their members’ interests. It has nine private retirement scheme providers and around 70 funds.
Source: The Sun Daily
PHILIPPINES
Philippine president Ferdinand Marcos has signed a bill into law to establish the country’s first sovereign wealth fund.
The Maharlika Investment Fund is intended to pool funds from state banks and government-controlled company for investment in currencies, bonds, equities and infrastructure projects, accelerating progress on 194 infrastructure projects, according to media reports.
The fund will have a capital stock of PHP500 billion (about $9 billion), PHP375 billion of which will be common shares held by the national government.
The remainder will be preferred shares available to state agencies, government-owned or -controlled corporations and financial institutions.
Sources: PhilStar Global, Bloomberg
SINGAPORE
Sovereign wealth fund GIC is set to acquire a logistics facility in Japan.
The facility is located in Yatomi city, part of the Greater Nagoya metropolitan area. The warehouse was completed last year by real estate developer Daiwa House Industry.
The real estate acquisition is not the first that GIC has made in Japan. In April, it announced that it had bought six logistics facilities from Blackstone for more than $800 million, a deal the US investment firm reportedly said was one of the biggest of its kind in Japan.
GIC affiliate Reco Pine last year bought a portfolio of Japanese hospitality assets from Seibu Holdings for $1.1 billion.
Sources: GIC, Bloomberg, Straits Times
THAILAND
Thailand’s Social Security Fund (SSF) is in danger of collapse in 30 years and requires reform, according to lawmakers and academics, the Bangkok Post reports.
The paper cited Worawan Charnduaywit, a social security programme adviser at the Thailand Development Research Institute, as saying that the SSF risked financial implosion in the next 30 years due to the fact that it will be paying pensions to an increasing number of people as the population ages and the workforce shrinks.
Source: Bangkok Post