AIIB adds Papua New Guinea, Kenya to its World Roster

Published

3 weeks ago

May 8, 2018

The Asian Infrastructure Investment Bank’s (AIIB) board of governors moved in early May to approve applications from Papua New Guinea and Kenya to join as regional and non-regional members, raising the Beijing-based financial institution’s total approved roster of countries to 86. The two prospective members will be recognized in full and granted a portion from AIIB’s existing pool of unallocated shares once they have fulfilled the requisite domestic processes and made their first deposit of capital. In May, the AIIB inked a Memorandum of Understanding (MoU) with the African Development Bank (ADB).

Launched in January 2016 with US$ 100 billion in capital and the support of a number of America’s closest allies in Asia and Europe as founding members – including Australia, South Korea, France, Germany, and the United Kingdom – the AIIB stands as an alternative to the World Bank and more regionally-focused Asian Development Bank (ADB), albeit one that is more attuned to China’s interest. With 30% of voting shares, Beijing still exercises an effective veto over the AIIB’s funding decisions.

Under the AIIB’s Articles of Agreement, shares are allocated based on the size of a prospective country’s gross domestic product (GDP) – regardless of their status as either an Asian or non-Asian member – with the number of shares determining a given member’s allotment of authorized capital. Including Papua New Guinea and Kenya, the bank has made 29 additions to its initial membership of 57 signatories, and expects to continue to welcome new members in the future, according to a press release.

SWFI First Read, May 25, 2018

Published

2 days ago

May 25, 2018

Site Director

MedInvestGroup Pushes Investment into Russian High-Tech Oncology Centers

The Russian Direct Investment Fund (RDIF) and Mubadala Investment Company have attracted MedInvestGroup, which manages a network of the PET Technology regional oncology and radiological centers, as a strategic investor in the joint management and development of a network of cancer diagnosis and treatment centers. The deal aims to significantly improve the efficiency of the already functional centers in Podolsk and Balashikha. The corresponding agreement was announced today at the St. Petersburg International Economic Forum.

Southern Satellite City and RDIF Reach a Financing Agreement

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French Industrial Giants Find Opportunity with RDIF

Published

2 days ago

May 25, 2018

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A number of French industrial companies continue to invest within Russia, finding opportunities within the mega country. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

CPPIB Targets 33% in Emerging Markets by 2025

Published

2 days ago

May 25, 2018

Site Director

The Canada Pension Plan Investment Board (CPPIB) generated a net return after expenses and pension contributions of 11.6% for the fiscal year ended March 31, 2018, versus its reference portfolio of 9.8%. For the reported fiscal year, CPPIB grew its net assets to a new high of C$ 356.1 billion (US$ 277.2 billion), compared to C$ 316.7 from the year previous.

Mark Machin, President and Chief Executive Officer at CPPIB, attributed the performance to the rising tide in public equity markets across most geographies, whose volatility in recent months was buoyed by significant fourth quarter earnings in the fund’s private holdings. Public and private equities, CPPIB’s first and third largest asset classes by exposure at 38.8% and 20.3%, saw estimated returns of 11.4% and 16.1%, respectively. Machin joined CPPIB in 2012 and was moved to the top in June 2016, following the departure of Mark Wiseman. Machin has a knack for the Asian region, being CPPIB’s first president for Asia and also spent nearly 20 years in Asia, working at Goldman Sachs. CPPIB plans to continue heavily investing in the APAC region, along with India.

Emerging Markets

“By 2025, we will invest up to a third of the Fund in emerging markets, which by that time are anticipated to account for 47% of global GDP,” said Machin in his section of the annual report outlining the pension’s updated strategic plan. CPPIB currently has C$ 56.1 billion invested in emerging markets, C$ 22.4 billion of which is wrapped up in China.

Foreign and emerging markets continued to dominate in CPPIB’s private equity investments with returns of 16.0% and 19.5%, compared to 1.8% for their Canadian counterparts. Asia was a standout market for the pensioner, which raised its exposure to private equity deals in the region by nearly 28% from C$ 13.4 billion to 17.1 billion, closed six direct investments worth C$ 1.6 billion, committed C$ 1.7 billion towards eight funds, and completed three secondary transactions for C$ 400 million.

With 275 global transactions completed over the fiscal year, CPPIB’s geographic exposure places 15.1% of its assets at home in Canada, 37.9% in the neighboring United States, 13.2% in continental Europe, 5.6% in the United Kingdom, 3.1% in Australia, and a whopping 20.4% in Asia.