Temasek’s global portfolio reaches record high

Agence France-Presse
Singapore state investment giant Temasek says the value of its global portfolio rose to a record high of $169 billion in the year to March thanks to a rebound in stock markets

STATE INVESTMENT FIRM. File picture of Temasek tower in Singapore by EPA

SINGAPORE – Singapore state investment giant Temasek said the value of its global portfolio rose to a record high of Sg$215 billion ($169 billion) in the year to March thanks to a rebound in stock markets.

The firm said in a statement its holdings jumped 8.6% from the previous financial year, and are now more than 3 times larger than at the height of the SARS scare 10 years ago.

Temasek — which has stakes in global names including Standard Chartered bank, Spanish energy giant Repsol and DBS bank — was boosted by an equities rebound as the US economy picked up and eurozone fears abated.

“Last year, there were some signs of recovery in the global economy. The severe disruptive risks from the global financial crisis subsided,” Temasek chairman S. Dhanabalan said in a statement.

However, he warned “structural risks have not been completely resolved”.

“Despite the turmoil over the last decade, the Temasek portfolio value more than tripled from a trough of Sg$61 billion in March 2003, when the SARS epidemic hit Asia,” he added.

Temasek executive director Ho Ching said however that the value of the company’s portfolio will depend on the performance of global stocks each year.

“We are almost entirely invested in equities,” she said in a statement.

“This means a lot more year to year volatility, as we have seen over the last 10 years,” she added.

The company said it invested Sg$20 billion in the financial year ending March 31, with the bulk of the investments going into energy and resources firms. It said it divested Sg$13 billion.

However, financial services continue to make up the majority of its portfolio, accounting for 31%, including stakes in the Industrial and Commercial Bank of China, the world’s biggest lender by market capitalization.

Temasek also said Asia remains the anchor of its investments, with the region accounting for 71% of underlying assets.

Singapore accounts for 30% of its total investments and China 23%, while exposure to North America and Europe was at 12%.

Temasek, one of Singapore’s two sovereign wealth funds, is a major shareholder in the city-state’s biggest firms, including Singapore Airlines and Singapore Telecom.

Chia Song Hwee, head of Temasek’s Investment Group, said at a news conference Thursday, July 4, that while it would continue to be mainly focus on Asia, it will seek new opportunities in North America and Europe despite market uncertainty in both regions.

“North America continues to be the centre stage for innovation… and Europe has many good and steady companies and we stand ready to assess them,” he told reporters.

He also said the liquidity crisis in China would not affect the country’s banks Temasek has stakes in as they are well capitalized.

“We invest in banks as a proxy to their underlying economies. Our view of the economy in China at least over the next 15 to 20 years continues to be positive mainly because of the demography.” – Rappler.com

 

 

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