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Singapore’s Temasek reports lower returns amid weakness in Asian markets

8 Jul 2014

singaporeSingapore’s sovereign wealth fund Temasek reported that it invested S$24m ($19.2bn) and sold assets worth S$10bn last year.

Temasek said that its portfolio has more than doubled in the past ten years and reached S$223bn ($178bn) by the end of 2013. Singapore, China and Australia accounted for 31 per cent, 25 per cent and 10 per cent of the fund’s portfolio, while north America’s share rose to 14 per cent from 12 per cent. Investments in third party funds stood at 10 per cent.

Temasek owns a 38 per cent stake in co-investment fund Astrea II, which has backed 36 private equity funds since its launch in April this year.

The fund’s total shareholder return (TSR)s reached 1.5 per cent, which it said was due to weakness of its key market in Asia. Over the past ten years, Temasek’s TSR amounted to nine per cent.

Half of the fund’s investments last year were in Asia as lower prices there offered “attractive investment opportunities.”

The net investment was S$14bn, or double the average annual investment level of around S$7bn over the past ten years.

Temasek said the top three sectors for investments during the year were financial services, life sciences and energy.

Temasek chairman Lim Boon Heng said, “This year has been one of our most active years for new investments – the most active since the global financial crisis – driven by softer Asian markets of interest, as well as the continued recovery of the global economy.”

“In the course of the past year, the US tapered its loose monetary stance and China reined in its debt fuelled growth.

“This bodes well for the longer term, though major central banks will most likely take some years to unwind the massive balance sheet expansions of the past five years.”

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