NORWAY – The 988.1 billion-crown (121.1 billion-euro) Petroleum Fund has funded 11 new fixed income and equity mandates with new mostly new money to a range of asset managers.
The fund said that capital was transferred to four new active fixed income mandates in the third quarter. TCW Asset Management Co. and Putnam Advisory LLC received capital for mandates for US mortgage-backed bonds. Nomura Asset Management and Daiwa SB Investments received capital for a regional mandate for Japan.
Capital was also transferred to seven new active equity mandates. Primecap Management Co., T. Rowe Price Associates Inc., Fidelity Pensions Management and Legg Mason Capital Management Inc. (two mandates) received capital for regional mandates. OrbiMed Capital LLC and Gartmore Investment Ltd. received capital for sector mandates.
“As a matter of policy we never disclose the mandate size,” said Norges Bank executive director Knut Kjaer. “Most of this is new money.”
The fund’s fixed income portfolio, which is 10% externally managed, returned 3.12% following interest-rate cuts around the world. The equity portfolio (41% externally managed) returned -0.99%, which it said reflected declining markets.
It said: “So far this year, the externally managed equity portfolios and the internally managed fixed income portfolios have contributed most to the excess return, although the internally managed equity portfolios and the externally managed fixed income portfolios have also outperformed their benchmarks.”
Overall, the fund made a 1.42% return in the third quarter, 0.02 percentage points lower than benchmark. The return in the first three quarters came in at 4.23%.
The Petroleum Fund's market value was 988.1 billion crowns at the end of the third quarter – an increase of 45.8 billion crowns since the start of the quarter. The rise in value was due to the depreciation of the crown and 52.1 billion crowns in new capital.
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