Kuwait Investment Authority
Country: Kuwait
Established: 1953
US$ Billion: 250
Origin: Oil
Transparency Rating: 6
Summary:
The Kuwait Investment Authority is the parent organization of the Kuwait Investment Office, which was initially established as the Kuwait Investment Board. The KIA invests in the Local, Arab and International Markets with its main office located in Kuwait City and a branch office in London, UK.
The Kuwait Investment Board was established in 1953 when Sheikh Abdullah Al-Salem Al-Sabah decided that oil revenue could be used to create a fund for the future and reduce its reliance on a single non-renewable resource. In 1961 the Minister of Finance, Sheikh Jaber Al-Ahmad Al-Jaber Al-Sabah, created the main investment policies for the fund that are still in use today.
The Kuwait Investment Office replaced the Kuwait Investment Board in 1963 and is based in the City of London. As a global and long-term investor, the KIO manages the Reserve for Future Generations and the General Reserve Fund, which was created in 1976. Investments of all asset classes are made in all geographical areas. Objectives of the KIO include maintaining the real value of the funds entrusted to the Office for the Future Generation Fund, achieving a fair return over the long-term, and to increase the favorable reputation as an expert and progressive institution in the international financial markets. As of fiscal year 2004/2005, the annual contribution to the Kuwait Future Generations Fund was valued at 896.24 million Kuwaiti dinars ($3,069.21 million USD, 1 KWD = 3.42454 USD).
The Kuwait Investment Authority ensures that the State of Kuwait transfers 10% of oil revenue into the Reserve for Future Generations on an annual basis.
KIA's board of directors is headed by the Minister of Finance, with other seats allocated to the Energy Minister, Governor of the Central Bank of Kuwait, Undersecretary of the Ministry of Finance, and 5 other nationals who are experts in the field, 3 of which should not hold any other public office.
Transparency:
Under the Law No. 47 of 1982 of the State of Kuwait regarding the establishment of the Kuwait Investment Authority, there are three clauses that are related to transparency and the disclosure of information. Clauses 5, 8, and 9 require that the KIA presents detailed reports pertaining to Assets Under Management to the Council of Ministers and that disclosure to the public of any information related to KIA’s work is subject to penalties.
Subsidiaries of the KIA:
NTEC (National Technology Enterprises Company of Kuwait)
NTEC is the direct venture capital conduit for the Kuwait Investment Authority. It was created in 2002 with around US$311 million in start up capital.
Major Direct Foreign Investments (Public)
| Company |
Country |
Industry |
% Ownership |
Comments |
| Victoria-Jungfrau Collection AG |
Switzerland |
Consumer Services |
23.81% |
|
| Arab Insurance Group |
Bahrain |
Financials |
12.35% |
|
| Jordan Phosphate Mines Company |
Jordan |
Minerals |
9.3% |
|
| Gea Group AG |
Germany |
Industrials |
7.9% |
|
| Daimler AG |
Germany |
Consumer Goods |
6.93% |
|
| Citigroup |
United States |
Financials |
6% |
Bailout - $6 Billion cash infusion |
|
News and Updates
4/9/08
Kuwait investment authority says regulation will 'handcuff' SWFs
From Morningstar, Thomson Financial writes that, "Bader Al Sa'ad, managing director of the Kuwait Investment Authority, has called for greater deregulation of sovereign wealth funds (SWFs), and said a code of conduct would harm global capital flows and 'handcuff' funds."
read more: Morningstar
4/8/08
KIA purchases about $800 million shares in Visa IPO ~ at least around 4% of shares.
1/25/2008
KIA Announces Participation in Citi Group and Merrill Lynch
Kuwait Investment Authority (KIA) announced that it agreed to a US$ 3 billion participation in the US$ 12.5 billion Citi Group Convertible Preferred Securities and US$ 2 billion participation in the US$ 6.6 billion Merrill Lynch Convertible Preferred Stock.
Location
Wren House
15 Carter Lane
London, EC4V 5EY
United Kingdom
Websites
Kuwait Investment Authority
NTEC
1. All figures quoted are from official sources, or, where the institutions concerned do not issue statistics of their holdings, from other publicly available sources.
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