Weekly investor roundup: GPIF posts 1% return for Q2; Taiwan pension funds' returns rebound after 5% loss
TOP NEWS OF THE WEEK
The Government Pension Investment Fund (GPIF), posted a 0.98% investment return, or 1.88 trillion yen ($16.6 billion), in the second quarter ended September, pushing its assets under management to 194.1 trillion yen ($1.71 trillion), the world’s largest pension fund announced on Nov 5.
It suffered a loss of 0.85% in foreign bonds portfolio, and a 0.77% loss in foreign stocks. Instead, domestic equities gained 5.25%, and domestic bonds returned 0.11%.
Taiwanese pension funds overseen by the Bureau of Labor Funds (BLF) reported NT$289.2 billion ($10.33 billion) of total investment income in the nine months to September, extending a rebound that began in November 2020 following losses when markets were hit by the coronavirus crisis last year.
Average investment return of the eight pension and annuity funds was 5.75% versus a 5.22% loss in January-September 2020, BLF says in a statement on November 2. The funds had incurred total investment loss of NT$240.1 billion in the first nine months of 2020.
Their assets as of September 2021 was NT$5.46 trillion, up 16.42% from NT$4.69 trillion a year ago.
Source: BLF; Asia Asset Management
The months-old Abu Dhabi Growth Fund has signed an agreement with Indonesia’s state wealth fund, enabling investments into high-yield financial instruments in the Southeast Asian country.
The United Arab Emirates had announced in March that it would invest $10 billion into Indonesia’s new sovereign wealth fund, the Indonesia Investment Authority.
The agreement came one day after the $110 billion sovereign wealth fund committed $418 million in convertible debt funding to Lime, a US electric scooter and bike startup based in San Francisco, marking the Adu Dhabi Growth Fund’s first known investment.
Ontario Teachers’ Pension Plan Board (OTPP) has allocated a 25% stake worth C$248 million ($199 million) in an infrastructure investment trust sponsored by the National Highways Authority of India (NHAI).
The NHAI will retain 15% of the units in the National Highways Infra Trust (NHIT), with the balance united placed with other institutional investors comprising pension funds, insurance companies, mutual funds, banks and financial institutions.
Proceeds from the subscription of units by investors will be used to develop road infrastructure in India.
Source: Ontario Teachers’ Pension Plan Board
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Australia’s central bank has tightened monetary policy, dumping its policy of yield curve control, after short-term bond yields soared in the last week.
The Reserve Bank of Australia decided to discontinue the yield target as a reflection of the economic recovery and “earlier-than-expected progress towards the inflation target”, governor Philip Lowe said.
However, the central bank also signalled that it would not raise short-term interest rates any time soon – at least until inflation reached the target range of 2-3%
Source: Financial Times
Hong Kong’s Mandatory Provident Fund will have lower administration fees once the retirement scheme is moved onto an electronic platform by 2025, according to Eric Lui, project director of the eMPF platform provisional office at the Mandatory Provident Fund Schemes Authority.
He noted that the MPF industry is fragmented, with 405 funds, 13 trustees and 12 scheme administration platforms. Around two-thirds of transactions are still paper-based.
“Every year, 65% of the overall 30 million MPF transactions are paper-based…Only 46% of employers are digital users,” he said at a financial technology forum in Hong Kong on November 2.
He said the eMPF will streamline administrative tasks and lower administration fees, which account for around 47% of MPF costs. It will also reduce paperwork for employers, provide employees with a one-stop platform, as well improve reliability and accuracy of the MPF system, he added.
Source: Asia Asset Management
Single family office Tsangs Group’s special purpose acquisition company (Spac) has been listed on the Nasdaq with the closure of its initial public offering (IPO) of 10 million units at an offering price of $10 per unit.
TG Venture, the Spac created by Tsangs Group, is focused on merging with a target company from the technology sector in a developed country, the group said in a statement. The target company will have a special focus within space technology, fintech or TMT (technology, media and telecom) sectors.
International Finance Corporation (IFC), the World Bank’s private sector arm, has teamed up with the Hong Kong Monetary Authority and German insurer Allianz Group to create a $3 billion climate investment platform.
The platform, MCPP One Planet, combines contributions from the three partners to provide loans that support the goals of the Paris climate accord to private companies in emerging markets.
It marks a further scale-up of the IFC’s Managed Co-Lending Portfolio Programme, a private debt platform launched in 2013 that has raised over $10 billion from 11 investors and provided financing to more than 200 firms across 55 developing countries.
It didn’t provide a breakdown of funding from the three partners, and spokespersons for IFC did not immediately respond to questions from Asia Asset Management.
Nippon Life Insurance has completed the process of converting Nippon Wealth Life Insurance into a wholly-owned subsidiary, following its announcement on Sept 22 to acquire the 14.9% of stakes owned by MassMutual International.
Furthermore, Nippon Life and MassMutual have agreed to continue maintaining good relations and interacting on a management and working level, including considering strategic cooperation in various business areas, Nippon Life said on Nov 1.
Source: Nippon Life Insurance
Two Korean pension funds have together invested €90 million ($104 million) in BlackRock Real Assets’ co-investment fund Global Infrastructure Solutions IV (GIS4), according to an investment management source in Korea.
The source said the fourth series of the infrastructure fund, aiming for an 11% internal rate of return, has surpassed its target commitment of €1 billion and is waiting for a few non-Korean institutional investors’ decisions. After the decisions are made, BlackRock will announce the final close of the fund, the source added.
Source: The Korea Economic Daily
GIC has acquired a 27-hotel portfolio in the US for $822 million through a joint venture with Summit Hotel Properties.
The portfolio comprises hotels run by the likes of Marriott, Hilton, Holiday Inn and Hyatt Place.
Hong Kong’s Link Reit has acquired prime retail properties in the Sydney central business district from GIC for A$532.8 million.
The deal involves a 50% stake in Queen Victoria Building, The Galeries and The Strand Arcade, all in Sydney’s CBD.
Source: Mingtiandi, Link Reit
GIC has invested $50 million into QI Tech, a fintech that provides financial services through APIs, in one of the largest Series A funding rounds in Latin America.
QI Tech will use the capital raised to construct new products and develop its data science team. The fintech firm counts fund managers, banks, and other fintech firms as its clients, and has handled more than $1 billion in credit transactions.
The Siam Commercial Bank had acquired a 51% majority stake in Bitkub, Thailand’s largest Crypto Exchange, for $536.6 million.
The bank said in a statement that it would be responsible for driving and engaging closely with the company to build its business and digital asset ecosystem and that digital asset exchange will become a key infrastructure segment in Thailand.
The deal is expected to be completed by the first quarter of 2022.
Source: Siam Commercial Bank, Reuters