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See How Much the Largest Sovereign Wealth Fund Has Invested in Russia

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Yngve Slyngstad, CEO of NBIM

Yngve Slyngstad, CEO of NBIM

Norway’s massive sovereign wealth fund is reviewing its portfolio allocation and risk profile on Russia. NBIM Chief Executive Officer Yngve Slyngstad told reporters in Oslo that in regard to Russian investments, “We are at any given time also considering conditions that have dimensions of geopolitics and geopolitical risk.”

Given the threat of sanctions from the West, institutional investors are growing cautious about their Russian investments. For example, in July 2013, the California Public Employees’ Retirement System (CalPERS) acquired a stake in Moscow’s 2.2 million-sqft Metropolis Shopping and Entertainment Mall through the Hines CalPERS Russia Long Term Hold Fund. The price was reported to be in the US$ 1 billion range.

The nearly US$ 850 billion sovereign wealth fund as of December 31, 2013 has a US$ 7.9 billion exposure to Russia in fixed income and equity investments. In essence, a 0.9% direct exposure to Russian assets. Norway’s GPFG has essentially zero exposure to Ukrainian assets.

norwaySWF_russia_dec2013

Exposure to VTB Bank

During that time period, the sovereign fund owned a 4.6% equity interest in VTB Bank OJSC. VTB Bank is led by Andrey Kostin, a key member of Putin’s United Russia party. Kostin has been an advocate for turning VTB into an international bank, setting up offices in Singapore, Dubai, London and Hong Kong. The investment banking subsidiary, VTB Capital, is seeking to cutting its staff in London and New York following the rapid succession of events unfolding in the Ukraine.

In addition, Norway’s GPFG has equity exposure to state-owned Sberbank of Russia – the largest lender in Russia. Ukraine’s acting Prosecutor General Oleh Makhnitskyi has accused Sberbank of “financing terrorism.” Sberbank denied the accusations.

NBIM’s Fixed Income Holdings in Russia

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SWFI First Read, September 19, 2018

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QIA Eyes Investment in Chinese Lender Lufax

The Qatar Investment Authority (QIA) is in talks about a possible investment into Shanghai-based Lufax, one of China’s largest online lenders. The seller of the possible stake is China’s Ping An Insurance (Group) Co. Ltd. Lufax’s official name is Shanghai Lujiazui International Financial Asset Exchange Co. Ltd.

Wealth Funds Back Hotpot Giant

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Japanese Government Capital Provides Initial Life for Texas Bullet Train

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Dallas-based Texas Central Partners, LLC is the developer of a proposed high-speed rail system, dubbed the Texas Bullet Train, between Dallas and Houston. Project costs are estimated between US$ 12 billion to US$ 15 billion. The developer secured US$ 300 million in project loans from Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN) and the Japan Bank for International Cooperation (JBIC). [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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DOJ Investing Tesla Over Musk Comments

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The U.S. Department of Justice (DOJ) is conducting a fraud investigation over Tesla as its CEO Elon Musk made public statements on twitter. This is a criminal probe. In addition, earlier, SWFI reported the U.S. Securities and Exchange Commission (SEC) is conducting a civil inquiry into Elon Musk regarding his statements.

This all surrounds Musk tweeting in August that he was thinking of taking Tesla private and had “funding secured” for the transaction. Both government authorities are seeing if Musk misled investors and violated federal securities laws with his public statements.

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