Norway Prime Minister Says its Sovereign Wealth Fund Will Divest From Russia
Posted on 02/27/2022
Norway Government Pension Fund Global (Norway GPFG), the country’s massive oil-based sovereign wealth fund, get directions from the Norwegian prime minister to divest its Russian assets. This is after Russia’s invasion of the Ukraine. The sovereign fund’s Russian assets comprises of equity shares in some 47 companies as well as government bonds, were worth 25 billion Norwegian crowns (US$ 2.83 billion) at the end of 2021, down from 30 billion crowns a year earlier, according to the Norwegian government.
“We have decided to freeze the fund’s investments and have begun a process of selling out (of Russia),” Norway Prime Minister Jonas Gahr Stoere told a news conference.
At the end of 2020, Norway GPFG held government bonds worth 6.7 billion crowns and equities worth 23.3 billion crowns, according to Norges Bank Investment Management (NBIM). NBIM oversees Norway’s GPFG.
NATO Secretary General Jens Stoltenberg is the incoming Governor of Norges Bank, which oversees the sovereign wealth fund.
At December 31, 2020, the top five equity holdings in Russia by Norway GPFG by Value in NOK was:
Sberbank of Russia PJSC: 6,024,052,467; Financials; 0.83% ownership
Gazprom PJSC: 3,980,549,983; Oil & Gas; 0.69% ownership
LUKOIL PJSC: 3,747,062,920; Oil & Gas; 0.90% ownership
Alrosa PJSC: 856,604,340; Basic Materials; 1.02% ownership
Novatek PJSC: 806,831,006 NOK; Oil & Gas; 0.18% ownership
Equity Holdings USD in Russia
2020: 2,725,532,580 USD
2019: 3,605,813,949 USD
2018: 2,699,952,245 USD
2017: 2,775,970,034 USD
2016: 2,695,940,367 USD
2014: 2,102,571,698 USD
2010: 5,247,536,470 USD
2007: 342,848,881 USD
Bond Holdings USD in Russia
Norway’s GPFG only holds Russian sovereign debt, not corporate debt, as of December 31, 2020.
2020: 785,155,429 USD
2019: 2,303,105,697 USD
2018: 1,229,837,604 USD
There has been calls for the North Dakota Legacy Fund to drop Russian government bonds. BlackRock Inc., Capital Group Companies, and Legal & General Group Plc are the top holders of Russia’s dollar bonds. BlackRock has an estimated US$ 1.5 billion of Russian government bonds outstanding. Many insurance companies, sovereign wealth funds, pension funds hold small exposure to Russian bonds. For example, as of March 31, 2021, Japan Government Investment Fund (GPIF) held various maturities of Russian government bonds. In 2021, GPIF disclosed it wouldn’t invest in Chinese government bonds due to settlement and liquidity issues.