Weekly Digest: MAS lists key Singapore insurers; KWAP unveils venture capital initiative
The following briefs are curated from press releases and third-party media sources.
TOP NEWS OF THE WEEK
The Monetary Authority of Singapore (MAS) has published its inaugural list of domestic systemically important insurers (D-SII).
The four insurers are AIA Singapore Private Ltd., Income Insurance Ltd., Prudential Assurance Company Singapore (Pte) Ltd., and Great Eastern Life Assurance Company Ltd.
The D-SII framework will come into effect on January 1, 2024, formalising and updating an existing network.
Being categorised as D-SII will require insurers to hold higher capital and have robust recovery and resolution preparedness plans in place.
Source: MAS
Public employees pension fund Kumpulan Wang Persaraan (KWAP) launched an investment platform called Dana Perintis to tap Malaysia’s venture and startup ecosystem. The plan is to invest up to RM500 million ($107 million) over the next 18 to 24 months in early-stage companies to drive innovation.
Dana Perintis encompasses two strategic pillars: investments into selected Malaysia-focused venture capital (VC) funds and direct investments into early-stage companies.
The allocation for each pillar is about RM250 million.
By strategically investing and addressing critical gaps, KWAP aims to propel the growth trajectory of the startup landscape, reaping attractive risk-adjusted returns for its stakeholders.
Source: KWAP
OTHER INVESTMENT NEWS
AUSTRALIA
Prime Super has acquired a 100% stake in Active Utilities, which offers a range of services including electricity, gas, water and customer support.
With 75,000 utility meters spread across 800 high-density assets nationwide, Active Utilities primarily operates in Victoria, Queensland, and New South Wales.
Prime Super's CEO, Lachlan Baird, revealed plans to expand Active Utilities over the next five years, aiming to increase the number of utility meters to 175,000 and employ more than 100 staff members.
The seller, Macquarie Group, initially became a major shareholder in Active Utilities in 2019, but has now sold its stake through Prime Super's investment manager, Patrizia Infrastructure.
Source: Patrizia
Following speculation last week, Qantas Super has confirmed that it intends to explore merger options after having reviewed its current scale and potential for growth.
The board of the A$8.4 billion ($5.5 billion) superannuation fund cited the ongoing consolidations occurring in Australia’s superannuation sector, particularly in corporate super funds, which have dwindled to just 11 from the 761 operating in 2004, according to APRA statistics.
Qantas Super chief executive Michael Clancy said that any potential merger partner would need to demonstrate the ability to administer defined benefit entitlements and provide the super fund’s members with equivalent rights to benefits, as well as improve member services and lower fees and costs.
Source: Financial Standard; The Sydney Morning Herald
CHINA
China Investment Corporation’s (CIC) chairman Peng Chun said closer international industrial cooperation is needed to inject more certainty into global sustainable development.
He also said the Chinese sovereign wealth fund is committed to its position as a long-term institutional investor that provides long-term capital for global sustainable development.
He made the remarks during the CIC Forum 2023 & Cross-Border Investment and International Industrial Cooperation Conference that was held in Hong Kong on September 20.
The forum hosted over 600 participants, including representatives from the Hong Kong SAR government, and those from prominent financial institutions and leading enterprises around the globe.
Peng said CIC has developed new ways for outbound investment to facilitate win-win industrial cooperation, adhered to responsible investing to fuel low-carbon and green development of the world, and sought to build a global ecosystem for cross-border investment that bridges communication.
Source: China Investment Corporation
The chief investment officers of three global pension schemes say they are re-evaluating or reducing their exposure to China as tensions between the world’s largest and second-largest economies escalate.
Alison Romano, CEO and CIO of the San Francisco Employees’ Retirement System, told the Fiduciary Investors Symposium at Stanford University on September 19 that exposure to the Chinese market had been a meaningful contributor to performance over recent years.
Mark Walker, CIO of the UK’s Coal Pension Trustees, told the symposium the fund had reduced its Chinese exposure from 15% to 10% of its public equities portfolio, under “pressure” from trustees and concerns about geopolitical risk. He said it would likely also reduce its private equity exposure to China going forward, but added that the country was too big to ignore or divest entirely.
James Davis, CIO of $25 billion Canadian fund OPTrust, said the China challenge was symptomatic of a broader concern around pricing geopolitical risk, especially in developing economies.
Source: Top1000funds.com
The Asian Infrastructure Investment Bank (AIIB) inaugurated its first overseas office on September 19 with the opening ceremony of the Bank’s interim operational hub in Abu Dhabi, the United Arab Emirates (UAE).
“This milestone reinforces our commitment to strengthen regional partnerships, promote sustainable development and support infrastructure projects for our members,” said AIIB vice president and chief administration officer Luky Eko Wuryanto.
AIIB is headquartered in Beijing.
Source: Asian Infrastructure Investment Bank
INDIA
Specialty investment firm Asia Healthcare Holdings, backed by US private equity investor TPG and Singapore’s sovereign fund GIC, has acquired a major stake in India’s Asian Institute of Nephrology and Urology (AINU) for 6 billion rupees ($72.1 million), the companies said.
Global investors are scouting India’s healthcare market to buy stakes in hospital chains amid huge demand for private health care, Reuters reported in June.
Last month, Indian eye hospital operator Dr. Agarwal's Health Care raised $80 million from existing investors Singapore's Temasek and TPG. Temasek had spent $2 billion in April to buy an additional 41% stake in Manipal Hospitals, one of the country's largest hospital chains, boosting its stake to 59%.
Source: Reuters
KOREA
The Industrial Accident Compensation Insurance and Prevention Fund has issued a request for proposals (RFPs) for domestic private equity managers.
Through its external manager Samsung Asset Management, the public fund plans to commit a total of W200 billion ($150 million) to four private equity funds. Eligible managers should manage a commingled fund with at least W150 billion in target size, with at least W150 billion in AUM and the representative fund manager should have at least five years’ experience in the private equity industry.
The selected manager will be announced on November 1. The W21.5 trillion pension fund has 14.8% target allocation to alternative investments that currently stands at 13.84%.
Source: The Industrial Accident Compensation Insurance and Prevention Fund
The Military Mutual Aid Association (MMAA) is looking to hire a Korean asset manager to oversee a foreign equity mandate of undisclosed value.
The investment will be structured as a fund of funds that focus on US, Japan, Vietnam and India equity, MMAA wrote in their request for proposals (RFPs). The winning bidder will be announced by end-October.
Firms bidding on the mandate must have a minimum three-year track record managing overseas equity funds, and a portfolio with at least W100 billion ($75.3 million) of foreign equity fund assets. This must include more than W50 billion of US equity funds and W10 billion each in Japan, India and Vietnam equities.
Source: MMAA
The Financial Supervisory Service (FSS), Korea's primary financial regulatory body, has issued management advisories to the National Federation of Fisheries Cooperatives (NFFC) after losing approximately W50.1 billion ($37.5 million) it poured into an alternative high-yield overseas investment.
The NFFC, the umbrella organization for regional fishers' cooperatives throughout the country, reportedly lost the entire principal amount of its investment without taking any further action, raising concerns over the federation's investment and risk assessment practices.
Upon evaluation, the FSS issued to the NFFC advisories concerning nine matters requiring caution and five matters needing improvement to bolster the federation’s due diligence procedures for foreign investments.
Source: The Korea Times
THE PHILIPPINES
Newly created sovereign wealth fund, Maharlika Investment Fund, has adequate safeguards against corruption and was set up with “good intentions” to drive strategic investments, including in sustainable finance and low-carbon energy, said a department of finance representative, in the government’s latest pitch to external partners.
Eufrocinio Bernabe Jr, assistant secretary at the Department of Finance, tried to assuage concerns about graft and corruption in the country, and highlighted that the new fund has at least eight safeguards in place to prevent corruption or even to correct negative “perceptions of corruption”.
Bernabe was speaking at the Unlocking Capital for Sustainability (UCFS) Philippines event held in Manila last week.
Source: Eco-Business
TAIWAN
The Financial Supervisory Commission (FSC) will ease procedures for fund launches to cut down on its administrative work, and also make changes to its so-called deep cultivation programme for foreign asset managers.
Applications for fund launches are currently done through the approval channel and the declaration channel, both of which are overseen by the FSC.
Starting in January 2024, the regulator will outsource the tasks of the declaration channel for domestic funds and non-environmental, social and governance funds to other bodies, including the Taiwan Stock Exchange, Taipei Exchange and Taiwan Depository and Clearing Corporation.
Source: Asia Asset Management