Norway SWF Chief Not Worried About U.S. Downgrade

Posted on 08/14/2011

In the aggregate, a growing number of sovereign wealth funds are allocating more to public equities, less in fixed income. This adds a bit of volatility to their portfolios but at the same time, some funds have achieved impressive gains in certain years. Norway’s Government Pension Fund Global has made significant strides in allocating to public equity in markets such as Europe and the United States.

Yngve Slyngstad, the head of Norway’s sovereign wealth fund, confirmed that the downgrade rating the United States received had no effect on the way the fund views investments in the country.

During the financial crisis, Norway’s Government Pension Fund Global had exposure to Fannie Mae and Freddie Mac. S&P gave many mortgage CDOs strong ratings at that point in time.

During a news conference regarding second quarter fund results last Friday, Yngve Slyngstad expressed, “The US debt downgrade had no effect on our portfolio or our thinking.”

Keywords: Norway Government Pension Fund Global.