Asian roundup: Malaysia’s EPF, Temasek, Ardian

first_img“Over the last few years, we have begun to focus on real estate and infrastructure investments that meet our risk/reward criteria while also progressively stepping up our participation in the private equity space,” the EPF said.The fund said it allocated an additional 1bnMYR (€221m) to external fund managers in 2013.With the added funds, total book value of its assets with external fund managers reached 72.5bnMYR, or 13.46% of the total, up from 56.3bn in 2012.Last year total assets increased by 11.4%.“Our global exposures are also beneficial during periods of ringgit weakness as they provide a buffer to our earnings,” the EPF said.“On the regional and global fronts, the financial landscape is anticipated to take an interesting turn, though possibly fraught with challenges.”The fund added that rising bond yields caused by the gradual withdrawal of the US quantitative easing programme will impact the domestic bond market. More than 40% of Malaysian government securities are held by foreign participants.In other news, Singapore’s Temasek Holdings has joined six institutional investors, including Paris-based Ardian, to launch a fund of funds that focuses on private equity investments.Astrea II has holdings in 36 private equity funds, the state-owned investment company said in a statement.Temasek is the fund’s single largest investor, with a 38% stake.Ardian, formerly known as AXA Private Equity, will manage Astrea II.An active investor in private equity funds globally for over two decades, Temasek had earlier sponsored Astrea I in 2006.Astrea I is similar to Astrea II and comprises a portfolio of private equity funds that are “balanced across vintages, geographies and sectors”.“Our strategy for investing in private equity funds is, and will continue to be, an important complement to Temasek’s direct investing activities,” it said. Malaysia’s Employees Provident Fund (EPF) has increased its overseas investments to one-fifth of the fund’s total assets and rebalanced its portfolio, cutting its holdings of bonds and boosting its allocation in real estate, infrastructure and private equity.The $180bn (€130bn) retirement fund said its annual return on investment (ROI) reached 6.97%, last year helped by “an increasingly globally diversified portfolio”.In 2012, ROI was 6.87%.Investments abroad accounted for 21% of total assets in 2013, compared with 17% a year ago, according to its annual report.last_img read more

Search for yield to continue for ‘long time to come’, BlackRock warns

first_imgLow interest rates, low oil prices and the search for yield will be norm for a long time to come, according to Larry Fink, chairman and chief executive at BlackRock, the world’s largest asset manager.“Currently, we are in a low-growth world,” Fink said during the symposium of pensions magazine PBM in Amsterdam last Thursday.However, he was positive about the prospects of equities due to technological developments and suggested investors look at the potential of new markets, such as Mexico.In Fink’s opinion, Mario Draghi, president of the European Central Bank, should be admired for his courage to push through his quantitative easing programme. “Draghi stabilised Europe,” Fink said. “Without him, the world would be in a deep recession.”He credited the rally of European equities to European companies benefiting from the fall of the euro relative to other main currencies.Fink said corporate Europe was still weak compared with the US, but he cited rising birth rates as the chief indicator that Europe was turning the corner economically. He said increased saving as a consequence of low interest rates was not necessarily a bad thing, “as it helps prevent future problems caused by liabilities”.He also took pains to emphasise the importance of having a long-term strategy, both for investors and companies, and chided the “current corporate pressure for a short-term approach”.Responding to questions from the audience, he said the solution must come from investors and regulators, adding that “fiduciary responsibility should be redefined”.Fink said he did not expect Greece to leave the euro-zone, but added that it would not matter if it did “because Greece is a small country”.Even then, he said any Grexit would not be a “real exit”, as Greece would “remain attached to the EU in so many ways”.last_img read more

EIOPA stands by new regime for personal pensions in final advice

first_imgA pan-European personal pension (PEPP) product should be seen not only as an opportunity to build large-scale cross-border pension providers but also as a means of developing a robust consumer protection framework, according to final advice to the European Commission.The European Insurance and Occupational Pensions Authority (EIOPA) stood by its previous recommendation that the Commission should develop a 2nd regime, complementing existing private pension products (PPPs).It said its development could help boost long-term investment and retirement income across the Continent.The emphasis on consumer protection came as EIOPA noted the lack of trust potential savers expressed when asked about existing PPP providers, while consumers also often regarded PPPs as being too expensive. “This strongly indicates that trust in PPPs and their providers needs to be restored to boost savings in PPPs,” the European supervisor said in its submission to the Commission.It added: “This goes hand in hand with aiming at affordable, cost-effective and transparent products, so consumers can make well-informed decisions about their retirement planning.”EIOPA’s paper added that personal pensions would only be able to deliver adequate retirement income if they were regarded as “safe […] cost-effective and transparent”, as well as able to cater to what the supervisor termed unconventional career paths.It continued: “A truly well-functioning Single Market for Personal Pensions would provide a means of unlocking positive externalities that have yet to be fully utilised at EU level – especially in the current challenging low-interest-rate environment – by easing the access to both new and additional cross-border investment opportunities, accessible at lower cost.”If successful, EIOPA added, PEPPs could contribute to a “flourishing” Capital Markets Union and encourage a greater focus on the long term over short-term investment, while benefiting the Continent’s economy.The idea of the PEPP has received support from a number of industry sources, including the European Fund and Asset Management Association, although the Dutch government pushed back at a time when a standardised approach, rather than a 2nd regime, was still under discussion.last_img read more

Railpen joins with US, Kuwait investors in $700m private equity JV

first_imgRPMI Railpen has joined public sector funds in Alaska and Kuwait to create a new alternatives investment management company.The three investors – including the $66bn (€53.6bn) Alaska Permanent Fund and the Public Institution for Social Security (PIFSS) of Kuwait – have committed an initial $700m to Capital Constellation, according to a joint press statement. The company will invest in “next generation private equity and alternatives managers” and plans to deploy more than $1.5bn in the next five years.Capital Constellation will be advised by Wafra, a $20bn investment company owned by PIFSS.Paul Bishop, Railpen investment director and a board member of Constellation, said the new joint venture offered “unmatched access to the next generation of successful alternatives managers, and will be a source of long-term returns that will help us achieve our mission to pay members’ pensions securely, affordably and sustainably”. “We think the historical outperformance of first-time funds is meaningful, as is the participation Constellation receives in [general partner] economics,” Bishop added.Julian Cripps, managing director of RPMI Railpen, said the deal demonstrated that the pension fund was “not afraid to think innovatively and act boldly”.Constellation will provide initial fundraising support for new managers in alternative asset classes such as private equity and real estate. It will also provide “strategic and operational support” for new firms as they look to raise capital from other investors.  It has already agreed its first investment of $100m into Astra Capital Management, a US-based private equity firm specialising in technology investments.Daniel Adamson, managing director of Wafra and president of Constellation, said the new venture had already begun working with Astra’s leadership team and described it as “a firm with the talent to ascend to great heights”.RPMI Railpen, the £25.5bn (€30bn) industry scheme for UK railways, had £2.4bn allocated to private equity at the end of 2016 via its legacy pooled fund. Railpen has been shifting its investment structure from asset class ‘silos’ to growth and income pools for the last few years. New private equity investments – including the Constellation investments – are held in its illiquid growth fund.PIFSS runs Kuwait’s social security funds, including pensions, sick pay and disability pay. Alaska Permanent was one of the world’s first sovereign wealth funds when it was formed in 1977, and invests the US state’s oil revenue.last_img read more

Norway’s SWF lost almost €18bn in Q1 – but still beat its benchmark

first_imgYngve Slyngstad, CEO, NBIMYngve Slyngstad, NBIM’s chief executive, said: “The most important expression of the risk in the fund is that the strategic equity share is set to 70%.“This means that fluctuations in the fund’s value are predominantly determined by the development in global stock markets.”NBIM said the return on the fund’s investments was 10 basis points higher than that of its benchmark, despite the overall loss.The GPFG’s equity investments made a 2.2% loss in the quarter, with fixed income investments down 0.4%. The fund’s unlisted real estate allocation made a 2.5% profit.Within the equity portfolio, North American stocks ended the quarter with a 2.3% loss, European stocks lost 3%, while Asia and Oceania stocks recorded a 1.4% loss for stocks.Emerging markets equities – which made up 11.5% of the equity portfolio – made a 0.6% profit in the quarter.At the end of March, 66.2% of the GPFG was invested in equities, 31.2% in fixed income and 2.7% in unlisted real estate.The fund’s value was NOK8.1trn at the end of March.In the first quarter, the Norwegian government withdrew NOK11bn from the fund, NBIM said. In addition, the Norwegian krone had appreciated against several major currencies during the quarter, NBIM said, which knocked NOK183bn from the value of the fund. Norway’s giant sovereign wealth fund lost NOK171bn (€17.7bn) in the first three months of this year as the international fall in stock markets took its toll on the fund’s heavy equities allocation.The Government Pension Fund Global (GPFG) lost 1.5% of its value in Q1, according to the latest interim report from the fund’s manager, Norges Bank Investment Management (NBIM).It said returns in the quarter had been coloured by growing uncertainty and increased volatility in global stock markets.During the three-month period, stronger US wage growth had pushed up inflation, there had been expectations of faster rising interest rates, and then worries emerged about increased protectionism.last_img read more

Dutch regulator warns schemes against too much local investment

first_imgVan Vollenhoven’s warning was at odds with Dutch politicians, who have urged pension funds to increase their local investments, for example to help finance the energy transition.“Investing too much in the Netherlands poses a risk, as schemes would become very susceptible to local economic cycles,” the DNB director said.“During an economic downturn, there would be a ‘triple whammy’, as pension fund participants could lose their jobs, the value of their homes could drop below the value of their mortgage, and either pension contributions would rise or pensions would be reduced.”However, she declined to specify whether there should be a hard limit on domestic investment, saying that “this would differ per pension fund and would be a board’s responsibility”.Sustainable investmentsIn her opinion, focusing on Dutch investments was not the same as increasing sustainable investments in general, as “more green investments would not lead to less diversification”.The director highlighted that increasing sustainable investment could even limit certain risks, including policy shocks.“For example, all property investors must have at least energy label C by 2023, which poses a risk to investors who don’t know the current energy label of their real estate,” she said.Another risk could be government measures to discourage the use of diesel engines, she added.Social affairs’ minister Wouter Koolmees, who attended part of the meeting, said pension funds could play an important role in financing the transition into a more sustainable economy.“But the government shouldn’t force such investments, as this is to be decided by employers and workers,” he said.As an example of sustainable investments in the Netherlands, Koolmees cited the thermal insulation of approximately 7,000 school buildings.“However, the problem is that all these schools have their own board, but they often don’t own the building,” he said.According to Koolmees, Invest-NL – a new government organisation focusing on opportunities for local investment financing – was to address the issue next year.The event was organised by asset manager APG and pensions think tank Netspar. Dutch supervisor De Nederlandsche Bank (DNB) has warned pension funds against investing too much locally, as this would make them susceptible to economic cycles in the Netherlands.Dutch schemes invest approximately 20% of their investment portfolio within the Netherlands, according to DNB statistics.Speaking during a meeting about sustainable investment on Wednesday, Gisella van Vollenhoven, DNB’s supervisory director for pension funds, said she was sceptical about increasing this percentage.“Given the fact that the Dutch economy is merely 1% of the world economy, 20% is a lot relative to other countries,” she said.last_img read more

Geneva pension fund mulls exclusion-to-engagement shift

first_imgThe CHF13.7bn (€12.6bn) pension fund for the canton of Geneva is debating re-integrating into its investment portfolio previously excluded sectors to allow it to adopt a larger active ownership role, according to its CIO Grégoire Haenni.CPEG, which is a member of $35trn investor engagement group Climate Action 100+, currently has nine sector exclusions, such as armament, nuclear power generation, pornography, tobacco, coal, and gambling.Addressing delegates at IPE’s annual conference in Copenhagen earlier this month, Haenni argued that exclusions did not have any impact on corporate behaviour.By way of example, he said that despite institutional investors excluding tobacco holdings from their portfolios since the 1990s, the industry had been outperforming the wider consumer staples sector and the S&P 500 for some time until governments moved to ban smoking in public. “Consumer behaviour has a real impact on the company,” said Haenni. “We believe engaging with corporates leads to better results than just excluding them from our investment universe.” CPEG’s Haenni addresses delegates in Copenhagen at IPE’s annual conferenceThe CIO argued that exclusions and positive filters, such as best-in-class approaches, allowed investors to express values and present a better image, but restricted the potential for engaging with companies and had implications for expected returns and deviations from benchmarks – in addition to not having any impact on corporate behaviour.CPEG currently deviated 5.5% from its benchmark as a result of its sector exclusions, said Haenni, and was facing pressure from beneficiaries to exclude fossil fuels and potentially other sectors.“If we go down that path we will start to deviate a lot from our benchmarks, so that’s a major issue,” he said.Trade-offsHaenni explained that CPEG wanted to engage more with companies, combining this with “norms-based exclusions” that would be made on a case-by-case basis according to a company’s activity and willingness to engage.The CIO summed up the trade-offs involved with pursuing this route as follows: “You have concrete results, but it’s difficult to comply with your values, you’re not going to look good because you keep those companies in your portfolio and you need to team up with other investors.”Asked by panel moderator Mats Anderson, vice chair of the Global Challenges Foundation and former CEO of Sweden’s AP4, to provide examples of successful outcomes of engagement, Haenni brought up the subject of gun manufacturers and how a group of nuns in the US – the Sisters of Mercy – had decided to reinvest in armaments and had productively engaged with gunmakers on safety features.“I think this is something we want to imitate,” said Haenni.Asked by a delegate why no investors were building up case law in the face of the apparent ineffectiveness of shareholder voting, Haenni said taking companies to court was “another tool to consider”. He suggested that, in the US for example, investors should team up with actors like NGOs to put pressure on corporates via class actions.Separately, the CIO said investors could also drive change at companies as bondholders, giving the example of mining company Glencore.Earlier this year the company agreed to align its business and investments with the goals of the Paris Agreement, a move that followed engagement with a group of investors that included Kempen as bondholder.last_img read more

Metallrente expands insurance consortium for workers protection

first_img“The consulting expertise of our new partner will help us supply additional provisions to protect the workers even more widely, ” said Heribert Karch, managing director at MetallRente.Karch is convinced that additional state benefits in the case of a reduction of earning capacity and providing security for disabilities “are more important than ever”.He added: “The cooperation with insurance companies has always been part of our philosophy, in order to broadly diversify possible risks and to make our offers available to many companies and employees.” Heribert Karch, MetallRenteMetallRente, which was founded in 2001 as a joint institution between the two social partners Gesamtmetall and IG Metall, offers company and private pensions.Members in the steel, wood and plastics, as well as textile and clothing industries, plus IT and metal and electronics sectors, have joined MetallRente after the conclusion of collective wage agreements.VKB, a regional insurer, will start consulting services in January 2021, said Klaus G. Leyh, management board member at the firm.“With our multi-channel sales, we are well positioned to persuade customers with the MetallRente offer for workers’ protection,” Leyh explained.Robert Heene, board member at VKB, responsible for life insurance, added that VKB fits in MetallRente’s consortium for its expertise on disability and workers insurance.Swiss Life Germany, which leads the consortium of insurers for MetallRente in the segment of workers protection, welcomed VBK as a new partner.“We can reach even more employees in the industries covered by MetallRente with the necessary financial protection against incapacity for work, employment and protection of basic skills, ” CEO Jörg Arnold said.Looking for IPE’s latest magazine? Read the digital edition here. German industry-wide pension fund Metallrente has expanded its insurance companies consortium by adding Versicherungskammer Bayern – VKB.Insurers Allianz, Ergo, R + V and Swiss Life are also part of the group.MetallRente provides disability and incapacity pension products to employees as part of their company pension scheme and other private offers.Public insurer VKB has generated premium income totalling €8.7bn in 2019. It operates in Bavaria, the Palatinate, Saarland, Berlin and Brandenburg.last_img read more

Dream home in Bushland Beach for sale

first_img110 Goicoechea Drv, Bushland BeachPOSITIONED  at the top of one of Bushland Beach’s most exclusive streets with panoramic ocean and mountain views, 110 Goicoechea Drv is sure to pull at the heart strings of even the most discerning buyer.The four-bedroom, three bathroom, three car space home was built by New Home Solutions and has 394sq m of under-roof space. 110 Goicoechea Drv, Bushland BeachIt’s on the coveted ocean side of the street and has both ocean and mountain views with expansive outdoors areas to enjoy them from.The property is being marketed by Ray White Townsville agent Wendy Litser.“The views are just fabulous,” she said. “They are uninterrupted views because there is an easement to the front of the property, so there is no chance of someone building in front of you. 110 Goicoechea Drv, Bushland BeachAs well as a double remote garage the home has a workshop while there is another carport perfect for housing a boat or caravan.The home is on a 817sq m block with low-maintenance gardens. Entry to the property is through a sliding automated gate, which adds another level of security to the home. 110 Goicoechea Drv, Bushland BeachThe open plan lounge, kitchen and dining areas all take in the magnificent views while concertina sliding doors link the inside with the outdoor deck.All the bedrooms have either walk-in wardrobes or built-ins and there is a dedicated study area for anyone who works from home.The house is fully airconditioned and fitted with solar while there is an in ground pool directly off the patio. More from news01:21Buyer demand explodes in Townsville’s 2019 flood-affected suburbs12 Sep 202001:21‘Giant surge’ in new home sales lifts Townsville property market10 Sep 2020110 Goicoechea Drv, Bushland Beach“It has a most gorgeous entrance with beautiful timber stairs.“It’s a great family home but I think it would also suit retirees who have family come up because there is a designated guest bedroom with its own ensuite.“I could happily live in the kitchen and it has bench space for miles, a double oven, Smeg appliances and a walk-in pantry.” last_img read more

Billionaire Clive Palmer’s latest purchase marks highest sale on the Gold Coast in 2018

first_imgClive Palmer has splashed $12 million on a new Gold Coast property.BILLIONAIRE Clive Palmer has splashed $12 million on a luxurious Mermaid Beach property, marking the Gold Coast’s highest sale this year.It was by chance the businessman came across the four-level Hamptons-style home on Millionaire’s Row, which belonged to developer John Potter.Tony Velissariou, of Tony V Real Estate, was the one who suggested Mr Palmer take a look at the Hedges Ave home.“He was looking at something else and when that wasn’t available, I suggested that he have a look at this one,” he said. The property is absolute beachfront.More from news02:37International architect Desmond Brooks selling luxury beach villa15 hours ago02:37Gold Coast property: Sovereign Islands mega mansion hits market with $16m price tag2 days agoMr Velissariou said a nine-year working relationship with Mr Palmer meant he had a fair idea of what he liked in a property.“That property is probably one of the most admired on the Gold Coast beachfront strip,” he said.The deal knocks another Hedges Ave property out of the top spot on this year’s list of highest sales.The house at No. 103-105 set the record for 2018 when it changed hands for $11.6 million.Property records show Mr Palmer’s latest purchase was built in 2006 and sits on a 809sq m block with 20m of beach frontage.Mr Velissariou described the five-bedroom, seven-bathroom home in his listing as “meticulously designed” with “the highest quality materials and finishings”. Inside the stunning home on Millionaire’s Row.While it wasn’t officially on the market when Mr Palmer bought it, Mr Velissariou knew the owner would be interested in selling if they found a buyer willing to pay the right price. “I took the property to market a few years ago and it never achieved what we wanted it to achieve,” he said.He said there was an offer on it back then but it fell over so when Mr Palmer came looking for a special beachfront home, he knew this was the one.last_img read more