Weekly investor roundup: China to allow more pension providers; GPIF reviews share-lending decision
TOP NEWS OF THE WEEK
China will expand its commercial pension pilot scheme nationwide from March 1 this year and allow other pension providers to participate in addition to six Chinese life insurers that have been allowed previously, China Banking and Insurance Regulatory Commission said on Monday (February 21).
CBIRC asked pension providers to keep exploring new products to cater to the need of new economy and flexible workers.
It initiated a one-year pilot scheme for commercial pension products in Zhejiang and Chongqing province from June 1, 2021. People's Insurance Company of China (PICC), China Life Insurance, China Pacific Insurance and three other Chinese life insurers are six designated providers of the pilot scheme since June.
The regulator said on Monday that since the pilot scheme, the six insurers have underwritten nearly 50,000 policies for 400 million yuan ($63.2 million) as of January this year, including almost 10,000 policyholders from the new economy sector, such as couriers and drivers of ride-hailing platforms.
Source: China Banking and Insurance Regulatory Commission (CBIRC)
The Government Pension Investment Fund (GPIF) is set to review the impact of its decision more than two years ago to stop lending shares, and intends to put the controversial move up for debate.
The world’s biggest pension fund, which manages nearly 200 trillion yen ($1.7 trillion) in assets, should have enough data to determine what impact the move has had on its investments, GPIF President Masataka Miyazono told Bloomberg News in an interview in Tokyo on Wednesday.
After compiling the data, the fund’s board of governors will review the decision in a process that may not be complete until Miyazono’s term ends in March 2025, he said.
Source: Bloomberg
In the recent Singapore budget, the city-state's government held back implementing a net wealth tax but raised income taxes for high earners and imposed higher levies on high-end property and cars.
The property tax rate for non-owner-occupied properties, including investment properties, will increase from 2023 to 12% to 36% from 10% to 20% previously, according to the 2022 budget announced last Friday. With immediate effect, luxury cars will be taxed at a rate of 220% for the portion of open market value above S$80,000 ($59,390) under a new Additional Registration Fee (ARF) tier
The personal income tax rate for those earning between $500,000 and S$1 million annually will rise to 23% from 22%, while earners in the above $1 million bracket will be taxed at 24%, up 2% from previously. The new rates will be effective from 2024.
However, Finance Minister Lawrence Wong did not rule out the future possibility of a net wealth tax, saying the government will continue to study the experiences of other countries and explore options to tax wealth effectively.
Source: Ministry of Finance, Singapore
In a letter to CEOs and chairs, APG has urged Samsung Electronics Co. and nine other South Korean companies that it has invested in to intensify efforts to reduce carbon emissions.
The Dutch pension fund called on large South Korean companies and major carbon emitters to step up their efforts to combat climate change on behalf of its pension fund clients.
In response to APG's request, Samsung Electronics said it was making efforts to reduce carbon emissions in all work sites in the US, Europe and China through strategies like using recycled plastic and adopting eco-conscious packaging.
In 2021, APG sold its stake in utility company Korea Electric Power Corp. due to the state-backed firm's lack of effort and ambition to cut its carbon emissions and fight against the climate crisis.
Source: APG, Korea Herald
MORE INVESTMENT NEWS:
AUSTRALIA
Hostplus and Maritime Super are discussing a merger after an April 2021 partnership that involved the latter moving the management of its investment assets to Hostplus’ Pooled Superannuation Trust.
The funds anticipate that upon the successful completion of due diligence the funds’ trustees will sign a successor fund transfer deed and prepare a transition plan which would target Hostplus’ and Maritime Super’s merger in early 2023.
The announcement on February 18 follows Maritime Super having undertaken a competitive assessment of potential merger partners and coincides with the funds having signed a Memorandum of Understanding (MoU), ahead of entering into reciprocal due diligence to confirm that a merger is in the best interests of their members.
Source: Hostplus
GigSuper, the start-up superannuation aimed at self-employed Australians, has folded with just A$50,000 ($35,980) in the bank.
It has at least A$3 million in debt despite having been established only in 2017 and raising A$3 million from more than 300 shareholders.
GigSuper reported a A$620,000 loss in fiscal 2019 and a loss of A$335,000 for 2020. Total assets stood at A$2.6 million by the end of last year, and members held about A$100,000 in savings accounts, which were frozen when administrators were appointed.
DW Advisory was appointed administrator in December and all employees were sacked. Diversa, whose MySuper products are among the worst performing funds, was the trustee for the fund.
Source: Australian Financial Review
The IFM Investors Private Equity Growth Partners Fund has drawn investors including the Clean Energy Finance Corporation (CEFC), and superfunds legalsuper and Hesta.
CEFC committed A$80 million to the fund, which aims to invest mainly in companies in the Australian technology, business services and healthcare sectors, which will be chosen based on their potential to drive a material reduction in emissions, the statement said.
The fund is established by industry super-owned IFM Investors and managed by their private equity team.
Source: IFM Investors
CHINA
China’s regulator warned over risks of illegal funding activities in the name of Metaverse, including those related to virtual real estate, high-tech, and virtual currencies.
In a recent risk reminder published on Friday (Feb 18), the China Banking and Insurance Regulatory Commission asked the public to keep a sharp eye over make-believe investment projects on Metaverse, as some carry the characteristics of illegal fund-raising, fraud and other illegal activities.
“Some criminals hype concepts related to Metaverse, such as game production, artificial intelligence, virtual reality, etc to fabricate high-tech investment projects with fancy packages, publicly and falsely publicize high returns, and take the opportunity to absorb public funds,” the regulator said.
Source: China Banking and Insurance Regulatory Commission
HONG KONG
A special purpose acquisition company (Spac) founded by former Alibaba chief executive officer Wei Zhe is applying for Hong Kong listing to look for mergers with smart car technology or cross-border e-commerce companies, according to its filing to Hong Kong Stock Exchange on Feb 15.
Sponsors of the Spac, Vision Deal HK Acquisition Corp, include Wei Zhe, chairman of private equity firm Vision Knight Capital; China’s cross-border merchant bank DealGlobe; and Opus Financial Group in Hong Kong.
This is the sixth Spac listing application in Hong Kong since the city’s bourse started to allow blank-cheque companies’ initial public offerings on Jan 1, 2022.
Source: HKEX
INDONESIA
A Singapore-backed Indonesian venture capital (VC) firm Intudo has co-led a US$4 million fundraising for Andalin, a digital freight forwarder in the country.
Intudo, backed by Black Kite Capital, the family office of Singaporean investor Koh Boon Hwee, was joined by Cardig Group, BEENEXT, and several strategic investors. The VC is focused on early-stage start-ups in Southeast Asia's biggest digital economy.
With the fresh funds, Andalin plans to double down on the Indonesia market, including expanding market coverage in the East Indonesia region, it said in a statement on Tuesday (Feb 15).
Source: The Business Times
INTERNATIONAL
The Montana Board of Investments has committed $50 million to the third Asia growth equity fund from venture capital firm BlueRun Ventures —BRV Lotus Fund III — as published in the fund’s minutes of its latest quarterly meeting.
The US pension fund currently manages over $23 billion in assets for the state of Montana. BlueRun Ventures is a private equity general partner firm headquartered in Menlo Park, CA, United States and has other offices in China and South Korea.
Source: Deal Street Asia
JAPAN
Former heavyweights of Nomura Holdings and GPIF have launched a fund betting on tech startups, supported by growing global interest in the nation’s venture companies. The fund started in December by Takumi Shibata and Tokihiko Shimizu has raised 3.3 billion yen ($29 million) so far.
About a quarter of that money comes from a private equity arm of Singapore’s Temasek Holdings Pte. The two founders aim to expand assets to 10 billion yen over the coming year, partly by attracting more overseas money, they said in an interview.
Source: Bloomberg
KOREA
Limited partners in Korea aim to increase their alternative assets, focusing on expanding private debt, according to a recent survey of 26 LPs. Their demand for real estate investment was low, the survey found.
A total of 92% of Korean LPs said they won't increase real estate exposure, while private debt and infrastructure are in the highest demand for stable cash flow and asset diversification.
The alternative assets managed by the Korean LPs total 381.1 trillion won ($320 billion), accounting for an average of 28.4% of their assets under management. Some 24 of the 26 LPs said they currently manage 204.4 trillion won in overseas alternative assets.
Source: Korea Economic Daily
MALAYSIA
A former Goldman Sachs partner said in court last week that he was driven by "greed and ambition" in a bribery scheme involving billions of dollars from Malaysia's 1MDB sovereign wealth fund.
Tim Leissner, former head of Goldman’s Southeast Asia operations, is a key witness in the ongoing criminal trial of his former colleague, Roger Ng, the bank's ex-head of investment banking in Malaysia.
"My greed and ambition took over," Leissner said, adding that bankers at Goldman were expected to be hired on every one of their clients' deals, and that missing one was considered "unacceptable.”
The trial which began last week in a New York federal court also heard Leissner testify that Ng was Goldman's lead banker on 1MDB and had cultivated a relationship with Malaysian financier Jho Low starting in 2008, who was the key intermediary between the bank and 1MDB.
Prosecutors claimed that Ng, who reported to Leissner, had received $35m from the latter for his role in the alleged scheme. Leissner has pleaded guilty to charges of bribery and is cooperating with the government's investigation.
Source: New Straits Times Yahoo News
SINGAPORE
Singapore's sovereign wealth fund, GIC, is in talks with the Bhartiya Group to invest ₹2,800 crore (US$375 million) in its commercial project in Bengaluru, according to an Indian business publication.
The deal will see GIC picking up 3 million sq ft of commercial assets in Bhartiya City, a 125-acre township project, from the builder, along with some revenue from its facility management business, according to unnamed sources.
The money will be used by the Bhartiya Group to repay part of its debt on commercial property that houses firms like IBM and Infosys.
Source: The Economic Times
A consortium of investors including Temasek Holdings, Hillhouse Capital, Boyu Capital and Sequoia Capital China has raised $2 billion for J&T Express in its latest funding round, according to sources.
The round, which valued J&T Express at $20 billion, closed near the end of last year, the sources said. The Asian delivery company plans to use the latest funds to support the expansion of its global delivery network and cross-border businesses, and to digitise its warehouse centres and business operation.
Source: Bloomberg