Singapore’s Temasek Holdings revealed in a new report that they generated a record net portfolio value of S$ 308 billion, and a net cash position for the financial year that ended on March 31, 2018. The annual return for that period was 12.19%. Temasek’s total assets including debt reached US$ 375 billion.
Investments in the Americas and Europe almost form a quarter of Temasek’s investments, behind China at 26% of the portfolio and Singapore at 27%. In addition, the United States was a key beneficiary of new investments for the fiscal year ended March 2018. Temasek also revealed that since 2002, in the aggregate, the entity’s unlisted assets have generated better returns than its listed investments. For the reported fiscal year, Temasek made US$ 22 billion in investments and US$ 12 billion in divestment. Some of Temasek’s larger divestments for the reported year are its positions in Dufry and Gaztransport & Technigaz. Furthermore, Temasek partially divested Celltrion Inc and Celltrion Healthcare, Industrial and Commercial Bank of China, Danamon and Burger King Brazil, while continuing to retain significant exposures in each of them.
Temasek is also pursuing investments in the synthetic biology sub-industry, making bets in firms like Perfect Day and Impossible Foods.
Temasek is betting on six trends when approaching investments.
1. Longer Lifespans
2. Rising Affluence
3. Sustainable Living
4. Smarter Systems
5. Sharing Economy
6. More Connected World
Bentall Kennedy Buys Stockton Logistics Center
Bentall Kennedy, through a U.S. fund it manages, acquired a NorCal Logistics Center in California for US$ 105 million. The property is located at: 4611 Newcastle Rd, Stockton, CA 95215.
Point Raises $122 Million
Point is a company that provides shared home equity financing. Point raised US$ 122 million in funding in an investment round led by Prudential Financial and DAG Ventures. Other investors in the round include Andreessen Horowitz, Ribbit Capital, Bloomberg Beta, Financial Venture Studio, and Enterprise Community Partners.
FBI Probes Boeing over 737 MAX
The Seattle Times reports the U.S. Federal Bureau of Investigation (FBI) is conducting a criminal probe into the Boeing 737 Max. Part of the probe includes whether Boeing staff had unduly influence and possible kickbacks to government officials at the Federal Aviation Administration (FAA).
The Cassa Depositi e Prestiti Group (CDP) and its investee companies, which include Fincantieri, Italgas, Snam, and Terna, have reached an agreement with the Municipality of Naples and the Authority of the Central Tyrrhenian Sea Port System. The entities will cooperate to provide for the development of Naples and its surrounding area. There will be a focus on helping the institutions and the community at large through financial support, real estate, and infrastructure investment, and support for local businesses. Signatories can help to provide technical expertise and planning, loans, and oversee public projects. Further, assistance and consulting will be provided, particularly as they relate to interventions and renegotiation of contract terms for the purposes of freeing up capital. Sustainable mobility will be a priority, with natural gas and biomethane forming the core fuels of the future. The group will be developing the ports, which will include the construction of emission-reducing structures.
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The Federal Reserve made a decision to hold interest rates steady and indicated that no more hikes will be coming for 2019. Federal Reserve Chairman Jay Powell addressed the media saying that the Chinese and European economies have slowed ‘substantially’. Despite low U.S. employment, Powell explained to the media that the U.S. has the lowest labor force participation rate among developed nations.
There were four interest rate hikes in 2018.
The Federal Reserve committee intends to conclude the reduction of its aggregate securities holdings in the System Open Market Account (SOMA) at the end of September 2019. Essentially, the Federal Reserve is ending quantitative tightening in September 2019. Furthermore, the committee intends to slow the reduction of its holdings of Treasury securities by reducing the cap on monthly redemptions from the current level of US$ 30 billion to US$ 15 billion beginning in May 2019.
In a March 20, 2019 statement called “Balance Sheet Normalization Principles and Plans”, a portion of it reads, “The Committee intends to continue to allow its holdings of agency debt and agency mortgage-backed securities (MBS) to decline, consistent with the aim of holding primarily Treasury securities in the longer run.
Beginning in October 2019, principal payments received from agency debt and agency MBS will be reinvested in Treasury securities subject to a maximum amount of $20 billion per month; any principal payments in excess of that maximum will continue to be reinvested in agency MBS.
Principal payments from agency debt and agency MBS below the $20 billion maximum will initially be invested in Treasury securities across a range of maturities to roughly match the maturity composition of Treasury securities outstanding; the Committee will revisit this reinvestment plan in connection with its deliberations regarding the longer-run composition of the SOMA portfolio.
It continues to be the Committee’s view that limited sales of agency MBS might be warranted in the longer run to reduce or eliminate residual holdings. The timing and pace of any sales would be communicated to the public well in advance.”
source: Federal Reserve website
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