By Hilary Mare
IN terms of global geographical split of asset allocation by region, the majority of Government Institutions Pension Fund (GIPF) investments are in Namibia, with over 49 percent invested locally, the fund’s Chief Executive Officer, David Nuyoma, has revealed.
Addressing delegates at the fund’s annual stakeholders gala dinner last Thursday, Nuyoma said that this local allocation is followed by more than 25 percent in the international market, over 18 percent in South Africa, with the remaining 6.9 percent in the rest of Africa.
“When looking at the asset class breakdown, we have diversified our investments, with equities taking up the larger portion, with over 55 percent in this portfolio; fixed assets make up slightly over 20 percent, with 16.8 percent in property. The rest of our allocations are in private equity, loans and cash portfolios,” he explained further.
Nuyoma also noted that as the largest institutional investor in Namibia, and in compliance to Regulation 28, the fund’s contribution towards the developmental agenda of the country cannot be understated.
“To date, GIPF has invested over N$4 billion into the local economy via its unlisted investment policy, since we first appointed the first round of fund managers in 2010. We believe that our contribution has greatly impacted and developed the local unlisted market, especially in the areas of property, private equity, debt and infrastructure,” he said.
One of the notable investments for the fund was the acquisition of a 25 percent stake in Capricorn Investment Group, at a cost of over N$2 billion, during March 2017.
“When we talk about investing in the local economy, it is not just empty talk, but rather a serious intention; which is why, after careful and due consideration, the fund purchased a significant stake in this Namibian-owned bank. We are of the considered opinion that Capricorn Group is a good asset, with good potential for income, as well as capital growth, over time. Through this investment, we also strengthen our local investments in the face of increasing local asset requirements for pension funds and long-term insurance companies, as well as reducing the extent to which entities such as ourselves can invest in dual-listed shares,” Nuyoma said.
“Another significant development at the fund is the managing of some of our investments in-house. Since we introduced the Treasury Unit in 2015, it now boasts assets worth N$11.2 billion under its management. This figure amounts to over 10 percent of our overall fund investments. This initiative has seen us optimise our excess offshore funds and also realising some savings on management fees.”
The fund’s total asset value, as at 30 September 2017, stood at over N$106.3 billion.
“You will recall that we have been waiting in anticipation to hit the N$100 billion mark, and despite continued market volatility, we were able to surpass that level. This is attributed mostly to acceptable performance in the local equity space and good performance from our international equity allocations, with the impact of the depreciating currency also chipping in. To this extent, the GIPF investment strategy remained resilient during the current market conditions and uncertainties,” Nuyoma added.
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