Weekly investors roundup: New Super Down Under; BLF appoints new managers
TOP NEWS OF THE WEEK
Fund manager Vanguard launched a pension fund in Australia called Vanguard Super on November 11 and is the first new fund license to be approved in the country in six years.
Vanguard Super opens with 12 products, including a default "Lifecycle" fund that gradually shifts a member's holdings into more conservative investments as they age.
The new super fund will hope to attract new members on the promise of low fees, which will be the lowest in the Australian pension market for younger members and those with balances under $33,080 (A$50,000) according to analysis from accounting firm Deloitte.
Source: Reuters
Bureau of Labor Funds (BLF) has appointed seven asset managers - four foreign and three local - for its NT$70 billion ($2.22 billion) domestic absolute return equity mandate that was tendered out last month.
The winning bidders are Allianz Global Investors Taiwan, Cathay Securities Investment Trust Co, First Securities Investment Trust Co, HSBC Global Asset Management (Taiwan), Hua Nan Investment Trust, Nomura Asset Management Taiwan, and Schroder Investment Management (Taiwan).
BLF announced the appointments in a statement on November 10. Funding will be split equally among the seven firms. Each will manage NT$7 billion for the Labor Pension Fund, Taiwan’s largest defined-contribution plan, and NT$3 billion for the Labor Retirement Fund, the largest defined-benefit plan.
Source: Asia Asset Management
OTHER INVESTMENT NEWS
AUSTRALIA
Australian superannuation funds CareSuper and Spirit Super are in discussion to merge and create a $28.96 billion (A$45 billion) fund.
Spirit Super, a fund with $16.7 billion (A$25 billion) of assets, was previously formed by a merger in 2021 between Tasplan and MTAA Super.
CareSuper is a $13.4 billion (A$20 billion) fund set up for professional, managerial, administrative and service occupations in all business sectors.
Source: Asia Asset Management
CHINA
China has amended rules for the management of state-run bailout funds rescuing troubled insurers, its financial regulators said on Thursday (November 10).
The rules aim to promote healthy development of the insurance industry, prevent and resolve financial risks and maintain financial stability, the China Banking and Insurance Regulatory Commission said in a statement on its website.
China Insurance Security Fund, which played a key role in bailing out fallen Anbang Insurance Group, is allowed to involve in the formulation of risk disposal plans, according to the new rules.
Source: Reuters
HONG KONG
Hong Kong’s government is exploring ways to expand and deepen its financial links with mainland China by adding insurance products to an array of cross-border investment platforms for stocks, bonds and wealth management instruments.
The move has been earmarked for the next phase of development when current efforts to establish after-sales service centres take root in the near future, according to Christopher Hui Ching-yu, Secretary for Financial Services and the Treasury.
It could be integrated as part of the Wealth Management Connect scheme launched in 2021, or as a stand-alone Insurance Connect scheme to allow cross-border sale of policies within the 11 cities covering the bay area, he said at the monthly Legislative Council financial affairs panel meeting on Monday. No decision has been made.
Source: South China Morning Post
INDIA
Maple Highways, a dedicated India road investment platform of Caisse de dépôt et placement du Québec (CDPQ), announced on November 11 that it has completed the acquisition of the Eastern Peripheral Expressway that encircles the National Capital Region.
Valued at $777 million (Rs. 6,267 crore), the purchase of the Toll Operate Transfer project from the National Highways Authority of India is the largest road transaction to occur as part of the Union Government's Asset Monetization Programme this year.
The 135-kilometre, six-lane express highway has been in operation since 2018 and was designed to decongest Delhi of commercial traffic. All lighting and other utilities along the expressway are fully solar powered.
Source: The Hindu Business Line; PR Newswire
INDONESIA
Indonesia Investment Authority (INA), Contemporary Amperex Technology (CATL), and CMB International Capital Corporation Limited (CMBI) has signed a Memorandum of Understanding (MoU), planning to carry out investment, fund establishment and other cooperation in the field of new energy.
All parties aim to jointly invest in the establishment of a Green Fund, which will focus on end-to-end electric vehicles (EV) value chain investment primarily in Indonesia, to support Indonesia’s sustainability and commitment to carbon neutrality by 2060.
The Green Fund will target investment opportunities in the emerging EV ecosystem. With the parties’ concerted efforts, INA believes the size of the fund would reach up to $2 billion.
Source: INA
Indonesian state-owned pharmaceutical companies PT Bio Farma (Persero) and PT Kimia Farma Tbk have signed a strategic partnership with China’s Silk Road Fund (SRF) and Indonesia Investment Authority (INA).
This investment collaboration was embodied in the signing of a Conditional Share and Purchase Agreement between Kimia Farma and its subsidiary, PT Kimia Farma Apotek with SRF and INA. Under the agreement, KFA will obtain funding to support its working capital to expand the company and provide improved health services to the Indonesian society.
As part of the partnership, SRF and INA will be participating in the planned rights issuance in Kimia Farma and investing in KFA for a 40% stake. The proceeds from the investment will go towards funding Kimia Farma and KFA’s strategic business expansion, working capital requirements as well as initiatives to further improve operational efficiency.
Source: Silk Road Fund
JAPAN
Japanese investors were net sellers of foreign bonds in October for a second straight month as overseas bond prices fell sharply amid expectations that the Federal Reserve would aggressively raise interest rates again to tame inflation.
According to data from Japan's Ministry of Finance, Japanese investors sold a net ¥2.58 trillion ($18.4 billion) worth of overseas bonds in October marking a second straight month of net selling. The data showed life insurers sold a net ¥1.5 trillion, while trust accounts disposed ¥1.4 trillion.
Meanwhile, Japanese investors were net buyers in overseas equities last month with net purchases worth ¥875.1 billion, as stock markets rallied.
Source: Today Online
KOREA
The National Pension Service (NPS) needs a major reform centered on cutting off excessive government intervention, according to Jeong Woo-yong, a member of the NPS’ Fiduciary Liability Committee.
He pointed out that the fund’s key decision-making bodies consist of “too many” government officials and lack economic experts. This hinders the fund’s growth, as it increases the fund’s vulnerability to being abused in different government projects with a lack of experts -- leading to lackluster profitability, he explained.
“Today, six of 20 members of the NPS’ Fund Management Committee -- the fund’s top decision-makers in terms of actually handling the money -- are government officials,” Jeong said at a press conference held at the National Assembly to improve the NPS’ governance structure.
Source: The Korea Herald
SINGAPORE
Singapore Life Holdings and Prudential are among insurance companies considering bids for the controlling stake in PT Bank Negara Indonesia’s life insurance business, according to people familiar with the matter.
Jakarta-listed conglomerate PT Astra International is also among the potential suitors for PT BNI Life Insurance, the people said, asking not to be identified because the matter is private. Deliberations are preliminary and a formal sale process hasn’t been kicked off, the people said. Other suitors could still emerge, they said.
State-owned BNI, which holds a 60% stake in PT BNI Life, is having initial talks over the structure of a potential sale with Sumitomo Life Insurance, which owns the remaining 40%, the people said. The Japanese insurer is an existing investor in closely-held Singapore Life, also known as Singlife, which is also backed by private equity firm TPG and UK-based insurer Aviva.
Source: Bloomberg