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Norway SWF Feels Market Movements in First Quarter of 2018

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Norway Government Pension Fund Global got hit in the first quarter of 2018, returning -1.53%. The fund had equity investments returning -2.22% and fixed income returning -0.37%. Unlisted real estate generated a 2.5% return for the first quarter of 2018. Technology stocks performed the best for the sovereign fund. The fund’s top three stock holdings for the first quarter were Apple, Microsoft and Nestlé SA. The fund did express expanding regulatory risk in internet companies could undermine returns. The telecommunications sector was the worst performing listed equity sector for the quarter for the sovereign fund, posting a -6.4% return.

“The most important expression of the risk in the fund is that the strategic equity share is set to 70 percent. This means that fluctuations in the fund’s value are predominantly determined by the development in global stock markets,” commented Yngve Slyngstad, CEO of Norges Bank Investment Management in a press release.

Norway’s GPFG had a market value of 8,124 billion NOK as of March 31, 2018.

Fixed Income

For the first quarter of 2018, Norway’s GPFG boosted government bond holdings in Italian, Brazilian and Indian bonds. Some of the biggest decreases in bond holdings were in countries from Mexico, Poland and South Korea.

China’s Central Bank Creates Macro-Prudential Management Bureau

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The People’s Bank of China (PBOC) created a new department to oversee and attempt to eliminate financial risks to the system. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Like its U.S. Peers, Legg Mason Seeks to Trim Costs

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Legg Mason Inc., a Baltimore-based asset manager, has announced a reduction in workforce as is prepares to streamline operations and save money. Legg Mason’s leadership commented that assets under management fell 5 % year-on-year. Legg Mason currently manages US$ 727.2 billion (as of December 31, 2018), which is down from the previous US$ 767.2 billion. CEO Joseph A. Sullivan noted that a global operating platform will centralize fund administration, IT, and other departments that work with affiliates. Sullivan did not discuss the number of layoffs expected, or specify which areas would be impacted. Legg Mason disclosed they planned to close a quarter of its exchange-traded funds in March 2019. These three ETFs include a U.S. strategy, emerging markets, and a developed markets strategy outside the U.S. However, these funds run around US$ 28 million in assets under management.

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Monetary Authority of Singapore Establishes Corporate Governance Advisory Committee

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On February 12, 2019, the Monetary Authority of Singapore (MAS) revealed the creation of a Corporate Governance Advisory Committee (CGAC). CGAC was formed to advocate for good corporate governance practices among listed companies in Singapore. Bobby Chin, Director of Singapore Telecommunications Limited, will be the Chair of CGAC. According to a MAS press release, “CGAC will identify current and potential risks to the quality of corporate governance in Singapore.”

MAS formed the Corporate Governance Council (Council) in February 2017. The Council was dissolved after it pushed out a publication of its final recommendations on August 6, 2018.

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