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Independent Singapore
4 days ago
- Business
- Independent Singapore
GIC maintains stable returns, grows portfolio to US$936 billion
SINGAPORE: Singapore's sovereign wealth fund GIC, which ranks as the 7th largest in the world with US$936 billion (S$1.27 trillion) in assets under management (AUM) according to GlobalSWF, reported a stable 3.8% real rate of return over 20 years. The fund's annual report, 'GIC Report FY2024/25,' released on July 25, showed a slight decline of 0.1 percentage points from last year's performance. Unadjusted returns were at 5.7% in US dollars, based on a rolling 20-year analysis. The portfolio shifts reflect strategic adaptability. GIC's investment landscape experienced significant changes in geography and asset classes. The portfolio's exposure to the Americas increased from 44% to 49%, mainly due to US investments. In contrast, exposure to Asia-Pacific fell from 28% to 24%. Additionally, the asset mix shifted, with real assets remaining constant at 23%, fixed income falling to 26%, and equities increasing from 46% to 51%. GIC has identified three key transformative forces: artificial intelligence (AI), climate change, and shifting global dynamics. The fund is adopting a detailed investment strategy, classifying potential AI investments as enablers, monetisers, and adopters. See also Is The Straits Times character-assassinating The Online Citizen? 'Granularity is about looking two, three layers deeper,' notes Group Chief Investment Officer Bryan Yeo, underscoring the fund's refined approach to new technologies. The fund's monthly return volatility hovered around 7% over 5- and 10-year periods. GIC's strategy emphasises long-term value creation while avoiding permanent capital loss through diversification and agility. GIC is also integrating AI within the organisation. For instance, it is testing a chatbot with its real estate and fixed income teams to improve analytical capabilities. The fund also takes a practical approach to sustainability, focusing on real-world transition rather than superficial portfolio changes. Commenting on the tech integration, Lim Chow Kiat, CEO of GIC, shared: 'Our organisational strength underpins our investment capabilities. One area demanding concerted effort and commitment across all levels of the organisation is technology integration. Like many, GIC is actively building its AI capabilities.' 'This includes in internal audit, where we leverage AI to detect anomalies in both structured and unstructured data, automating the analysis of large and diverse data sets to identify risk trends and focus areas,' he adds. In its annual report, the fund acknowledged complicated global issues. Increased geopolitical tensions, technological disruption, fragmented trade, and changing economic dynamics are a few of these. Speaking on these challenges, Lim said, 'In an increasingly more volatile and fragmented trade system, policy decisions can quickly reverse advantages, reminding us that today's winners may not remain so tomorrow.' Lim observed that the current fragmentation of the global trading system is also unfolding in capital markets. This also extends to financial systems, which are divided along geopolitical fault lines, complicating cross-border investing. In response to this, GIC's investment strategy now focuses on three main principles. These are geographic and asset class diversification, tightly focused investment strategies, and rapid response to new market trends. Despite challenging international circumstances, the fund notes that it is employing transparent methods and a cautious strategy to manage Singapore's reserves. While navigating an increasingly complex investment environment, the fund remains committed to creating long-term value. GIC tends to rely on two pillars in managing the portfolio: top-down portfolio construction and bottom-up asset selection. Speaking on the funds investment approach, Lim said, 'We diversify with intent, deploy with granularity, act with agility, and invest in partnerships, always taking the long view, protecting against permanent impairment, and preparing rather than predicting.' GIC is also noted to be actively engaged in a strategy of partnered investments, with a track record of co-investing with major sovereign and state investment funds worldwide, across more than 40 markets. '2025 may be a turning point in markets — and in history. 'There are decades where nothing happens, and weeks where decades happen.' We are living in one of those moments. As the investment world grows more complex, our responsibility to steward Singapore's reserves— with integrity and foresight—remains our guiding purpose,' notes Lim.
Mint
4 days ago
- Business
- Mint
GIC Boosts Americas Exposure to 49%, Eyes AI Deals in US
(Bloomberg) -- Singapore's GIC Pte ramped up investments in the Americas while its Asia-Pacific holdings declined, as the giant sovereign wealth fund wagers that the US will benefit most from the artificial intelligence boom. North and South America accounted for 49% of GIC's assets as of March, up from 44% a year earlier. Asia-Pacific assets fell to 24% from 28%, according to the fund's annual report released Friday. Europe, the Middle East and Africa were unchanged at 20%. The shift comes as GIC expects a slowdown in the second half of the year alongside rising inflation and uncertainty driven by domestic and geopolitical pressures. The fund's annualized five-year return rose to 6.1% in nominal US dollar terms, up from 4.4% a year earlier. GIC doesn't publish yearly performance figures. 'The forces of change have clearly intensified and will be much harder to prepare for,' said Chief Executive Officer Lim Chow Kiat. He added in a letter accompanying the report that '2025 may be a turning point in markets — and in history.' GIC, which consulting firm Global SWF estimates has assets under management of $936 billion, is aiming to ramp up deals in artificial intelligence. Lim cited the technology — and AI's effect on US companies in particular — as a reason why some of its geographic holdings may change. Global SWF Managing Director Diego Lopez estimated that GIC's annual return was about 10.8%, which he said was 'good but not great.' The firm's 10-year annualized returns of 5% are slightly below average compared with the sovereign wealth funds it tracks, he said. 'It's also way below what a 60/40 traditional portfolio would've returned, which is 7.5% in this period of time,' Lopez said. 'The performance could be better.' GIC's AI investments in the US include Atlan, and Ramp, a financial operations firm in New York. 'The US is a huge market, continues to be very innovative, and trends like AI benefits the US the most,' because there are many American companies that can leverage the technology, Lim said in an interview. 'To the extent that the US is allowing us to deploy more capital, the percentages in other regions will become smaller.' Despite the shift away from Asia-Pacific, GIC still sees opportunities there. Group Chief Investment Officer Bryan Yeo said the fund expanded its investment team in Japan over the past year and continues to evaluate deals in India and China. GIC has also anchored several recent initial public offerings in Hong Kong as a cornerstone investor. 'Our base case is really lower growth and, on the margins, higher inflation,' Yeo added. 'We have to get over the higher valuations that we see in India — so it's always figuring out 'is the opportunity in India priced relative to its growth prospects?'' GIC reduced the level of detail it publishes about its investments. For the first time since it began issuing annual reports in 2008, the state-owned investor didn't provide the percentage of its total holdings in any specific country. Nor did it offer specifics on how much of its portfolio sits in developed versus emerging-market equities, private equity or real estate — which it provided in previous years. Instead, all holdings were categorized by what it labels as equities, fixed income or real assets. GIC said these represent exposure to growth, income and inflation, respectively. That means an asset like gold can sit in a variety of categories depending on how it's used. Inflation-linked bonds — which made up 7% of GIC's portfolio last year — sit within the real assets category alongside property, and not in fixed income. By these new measures, 'equities' rose to 51% of assets from 46% a year earlier, while 'fixed income' fell to 26% from 32% over the same period. 'Real assets' were largely flat at 23%. Within equities, the fund increased investments in the US, which remains its largest market by capital deployment. The reduced disclosure from the firm, which doesn't reveal the value of its assets, comes as countries around the world increase scrutiny of foreign investors amid rising populism and national security concerns. 'It's most important to present information in a way that allows you to have a good idea of what GIC's portfolio is like,' said Lim. 'We believe that we are providing sufficient information for the understanding of our stakeholders.' Lopez said the decrease in fixed income was likely due to the rising valuations of US 'Magnificent Seven' tech stocks and increased deployment in the private equity space across America. And the shrinking allocation to Asia-Pacific was probably from reductions in the value of assets in China and Japan, he added. But he said GIC's decision to provide much less granular detail on its investments made it hard to be certain, and that its actions matched a trend started by some sovereign wealth funds in the Middle East — which earlier this year similarly cut back on the amount of detail they disclose about their portfolios. 'This reduction in information is quite concerning,' said Lopez. He said the Singapore investor is a signatory member of the Santiago Principles, which advocate for transparency and good governance, yet 'they're becoming less and less transparent with time.' (Updates SWF's estimate of GIC's assets under management in the fifth paragraph, adds quotes and other details.) More stories like this are available on
New Straits Times
16-07-2025
- Business
- New Straits Times
PNB named top Malaysian sovereign investor, 17th globally in global SWF rankings
KUALA LUMPUR: Permodalan Nasional Bhd (PNB) has been recognised as the top Malaysian sovereign investor and ranked 17th globally in the 2025 GSR (Governance, Sustainability, and Resilience) Scoreboard published by United States-based research firm Global SWF. The GSR Scoreboard has become the measuring stick of best practices among state-owned investors around the world. It evaluates more than 200 sovereign wealth funds (SWF) and public pension funds worldwide on governance practices, sustainability commitments and institutional resilience. In a statement today, PNB said it received an overall score of 84 per cent, including a perfect 10 out of 10 for sustainability, in recognition of its climate targets, environmental, social and governance (ESG) integration, and transparency in reporting. "The ranking reflects the significant progress PNB has made in strengthening governance, embedding sustainability across its investment processes, and enhancing its long-term institutional resilience," it said. PNB deputy president and group chief executive Datuk Rick Ramli said the ranking reflects the fund's ongoing efforts to incorporate responsible and sustainable practices in its operations and investment activities. "It is also a strong encouragement for us to continue pushing for long-term value creation for our unit holders and the wider Malaysian economy, in line with PNB's purpose of uplifting the financial lives of Malaysians across generations," he said. PNB said that notable progress includes a 98 per cent reduction in Scope 1 and 2 emissions from its 2022 baseline, in line with its target to achieve net zero operations by 2025. On portfolio-level targets, PNB has pledged to achieve a net-zero investment portfolio by 2050 and has so far channelled RM5.5 billion into green and transition assets, representing 55 per cent of its RM10 billion target by 2030. PNB has also implemented a living wage policy for its employees since 2023 and is now encouraging its investee companies to adopt similar practices under the government's GEAR-uP initiative. -- BERNAMA
Malay Mail
16-07-2025
- Business
- Malay Mail
PNB named top Malaysian sovereign investor, 17th internationally in Global SWF rankings
KUALA LUMPUR, July 16 — Permodalan Nasional Bhd (PNB) has been recognised as the top Malaysian sovereign investor and ranked 17th globally in the 2025 GSR (Governance, Sustainability, and Resilience) Scoreboard published by United States-based research firm Global SWF. The GSR Scoreboard has become the measuring stick of best practices among state-owned investors around the world. It evaluates more than 200 sovereign wealth funds (SWF) and public pension funds worldwide on governance practices, sustainability commitments and institutional resilience. In a statement today, PNB said it received an overall score of 84 per cent, including a perfect 10 out of 10 for sustainability, in recognition of its climate targets, environmental, social and governance (ESG) integration, and transparency in reporting. 'The ranking reflects the significant progress PNB has made in strengthening governance, embedding sustainability across its investment processes, and enhancing its long-term institutional resilience,' it said. PNB deputy president and group chief executive Datuk Rick Ramli said the ranking reflects the fund's ongoing efforts to incorporate responsible and sustainable practices in its operations and investment activities. 'It is also a strong encouragement for us to continue pushing for long-term value creation for our unit holders and the wider Malaysian economy, in line with PNB's purpose of uplifting the financial lives of Malaysians across generations,' he said. PNB said that notable progress includes a 98 per cent reduction in Scope 1 and 2 emissions from its 2022 baseline, in line with its target to achieve net zero operations by 2025. On portfolio-level targets, PNB has pledged to achieve a net-zero investment portfolio by 2050 and has so far channelled RM5.5 billion into green and transition assets, representing 55 per cent of its RM10 billion target by 2030. PNB has also implemented a living wage policy for its employees since 2023 and is now encouraging its investee companies to adopt similar practices under the government's GEAR-uP initiative. — Bernama
Malay Mail
16-07-2025
- Business
- Malay Mail
PNB named top Malaysian sovereign investor, 17th globally in Global SWF rankings
KUALA LUMPUR, July 16 — Permodalan Nasional Bhd (PNB) has been recognised as the top Malaysian sovereign investor and ranked 17th globally in the 2025 GSR (Governance, Sustainability, and Resilience) Scoreboard published by United States-based research firm Global SWF. The GSR Scoreboard has become the measuring stick of best practices among state-owned investors around the world. It evaluates more than 200 sovereign wealth funds (SWF) and public pension funds worldwide on governance practices, sustainability commitments and institutional resilience. In a statement today, PNB said it received an overall score of 84 per cent, including a perfect 10 out of 10 for sustainability, in recognition of its climate targets, environmental, social and governance (ESG) integration, and transparency in reporting. 'The ranking reflects the significant progress PNB has made in strengthening governance, embedding sustainability across its investment processes, and enhancing its long-term institutional resilience,' it said. PNB deputy president and group chief executive Datuk Rick Ramli said the ranking reflects the fund's ongoing efforts to incorporate responsible and sustainable practices in its operations and investment activities. 'It is also a strong encouragement for us to continue pushing for long-term value creation for our unit holders and the wider Malaysian economy, in line with PNB's purpose of uplifting the financial lives of Malaysians across generations,' he said. PNB said that notable progress includes a 98 per cent reduction in Scope 1 and 2 emissions from its 2022 baseline, in line with its target to achieve net zero operations by 2025. On portfolio-level targets, PNB has pledged to achieve a net-zero investment portfolio by 2050 and has so far channelled RM5.5 billion into green and transition assets, representing 55 per cent of its RM10 billion target by 2030. PNB has also implemented a living wage policy for its employees since 2023 and is now encouraging its investee companies to adopt similar practices under the government's GEAR-uP initiative. — Bernama
