Recovery in action: Irish SWF liquidates

The portion of Ireland’s sovereign wealth fund where investments can be made at the direction of the Minister for Finance, directed investments, is now considerably bigger than the fund’s discretionary portfolio, following a further €4.5 billion liquidation in April. This liquidation was at the direction of the minister to provide the €10 billion sum of the State’s €17.5 billion contribution to the €85 billion EU/IMF program of financial support for Ireland.

After this contribution the value of assets in the discretionary portfolio of the National Pensions Reserve Fund was reduced to €9.8 billion in March and further reduced in April to €5.3 billion when the second liquidation was made.

This amount would include capacity for the proposed investments in Irish infrastructure assets and water metering services as set out in the National Recovery Plan 2011-2014.

At the end of March, the fund’s discretionary portfolio invested 50 per cent in quoted equities, 21.4 per cent in financial assets and 28.6 per cent in alternatives including 9 per cent in private equity.

The directed portfolio consists of ordinary and preference shares in Allied Irish Banks and Bank of Ireland as well as cash realised in respect of the State’s contribution to the support program.

They represented 36 per cent and 49.9 per cent respectively of the ordinary share capital of Bank of Ireland and AIB.

Sponsored Content

The performance of the discretionary portfolio continues to outstrip that of the directed portfolio with returns of 11.1 per cent and -7.9 per cent respectively for 2010.

Leave a Comment

Sort content by

Peter Bernstein: Risk Inverse

Peter Bernstein, an economic consultant and respected investment thinker passed away on Friday June 5 in New York. Widely regarded as an intellectual giant in the investment circles for his ability to translate complex mathematical models into practical applications, he founded the Journal of Portfolio Management in 1974 and wrote a number of respected books

…as consultant assessment initiates changes to internal equity team and technology

CalPERS has reached its capacity to internally manage equities portfolios and would need to make changes to technology and staff resources if the internally-managed equities program is expanded, according to the outcome of the annual consultant review of CalPERS’ internal equity team by Wilshire Associates. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

Asset class review inspires opportunistic allocation at CalPERS’

CalPERS is considering adopting an “opportunistic” program seeking to profit from substantially undervalued assets across various asset classes and strategies, and will be limited to 3 per cent of the fund’s total market value. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

The future of risk management: How independent should risk management be?

Barry Schachter, research associate with the EDHEC Risk and Asset Management Research Centre and director, quantitative resources, Moore Capital Management believes the current crisis is a catalyst for change in the conduct of risk management because it has challenged the efficacy of the existing risk management model, but simply imposing regulation is not the change

SWFs struck at financial crisis epicentre: $50b in losses from financials

For their biggest public market investments in the last two years, sovereign wealth funds (SWFs) zeroed-in on the most dogged companies in the worst-performing sector: Western financials. These decisions incurred paper losses of $US56.3 billion, accounting for most of their public market losses for the period. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

Working hard for the money

Last year large institutional investors in the US, including the State of Massachusetts Pension Fund and CalPERS, dedicated money to senior bank loans. Amanda White examines the outlook for the sector and talks to group head of ING’s senior loan group, Jeff Bakalar, about whether institutional allocations to the sector have been tactical or strategic.

Previous