Norway’s Pension Fund Global Returns 2.1% in Q2; Asset Value Rises to $1.69T

Equities were responsible for the sovereign wealth fund’s 8.6% first half gains.



Equities were responsible for all of Norway’s Government Pension Fund Global’s first half investment returns, as the sovereign wealth fund’s investment portfolio gained 2.1% in the second quarter and 8.59% for the first half of 2024. The returns brought its asset value to 17.75 trillion kroner ($1.69 trillion).

Performance for both the second quarter and the first half fell short of the pension fund’s benchmark index by 0.23 and 0.04 percentage points, respectively.

Equities were the top-performing investments for the fund and the only ones that produced positive returns in the first half of the year, gaining 12.47% for the period and 3.07% for the quarter. Fixed-income investments declined 0.27% for the quarter and 0.62% for the first half, and investments in unlisted real estate gained 0.04% for the quarter but were down 0.50% for the half. The worst-performing investments were in unlisted renewable energy infrastructure, which lost 7.11% for the quarter and 17.69% for the first half.

“The equity investments gave a very strong return in the first half of the year,” said Norges Bank Investment Management CEO Nicolai Tangen in a statement. “The result was mainly driven by the technology stocks, due to increased demand for new solutions in artificial intelligence.”

Never miss a story — sign up for CIO newsletters to stay up-to-date on the latest institutional investment industry news.

Norges Bank, Norway’s central bank, manages the GPFG on behalf of the Ministry of Finance. According to Norges Bank, it is now reporting its updated holdings list twice annually instead of once per year. As of the end of June, the pension fund’s asset allocation was 72.01% equities, 26.15% fixed income, 1.73% unlisted real estate and 0.11% unlisted renewable energy infrastructure. This compares with 70.88% equities, 27.10% fixed income, 1.91% unlisted real estate and 0.11% unlisted renewable energy infrastructure at the end of 2023.

“We are already the world’s most transparent fund, but now we are increasing transparency even further,” said Tangen. “From now on, everyone will be able to find an updated overview of all our investments on a half-yearly basis.”

Among the equity investments, the tech sector provided the highest first half returns, gaining 27.9% during the period, followed by financials, which were up 13.8%. Combined, the sectors make up more than 40% of the pension fund’s equity investments, with a 25.8% allocation for tech stocks, and a 15% allocation to financials.

Industrial stocks provided an 8.2% return, followed by investments in consumer discretionary, utilities and telecommunications, which gained 7.9%, 6.2% and 5.2%, respectively. Consumer staples and real estate stocks increased 1.4% and 1.2%, respectively, while the GPFG’s basic materials stocks were the only equity investments not to provide gains for the half, declining 0.3%.


Related Stories:

Tech Stocks Lead Norway’s Pension Giant to 6.3% Return in Q1

Norway’s Pension Fund Global Rebounds in 2023, Still Misses Benchmark

Japan’s GPIF Reclaims World’s Largest Pension Fund Title

Tags: , , , , , , ,

Alecta Returns 7.7% in First Half of 2024

The assets of Sweden’s largest pension fund grew to $126 billion.


Swedish pension fund Alecta announced Tuesday that it returned 7.7% in the first half of 2024, amidst a probe from the country’s financial regulators into the fund’s previous investments losses, which included several failed U.S. regional banks. 

Assets of the fund grew to 1.31 trillion Swedish kronor ($126 billion) at the end of the second quarter. Strong performance came from equities, which returned 12.9% in the period.  

In 2023, Alecta lost more than $2 billion, including losses from the fund’s investments in several U.S. regional banks which collapsed last year, including Silicon Valley Bank and First Republic Bank. The fund was also scrutinized for its stake in Heimstaden Bostad, a Scandinavian real estate group through which the fund suffered a $1.2 billion loss. 

For more stories like this, sign up for the CIO Alert newsletter.

The fund’s series of losses led to the firing and resignation of several key executives and to a probe from Sweden’s Financial Supervisory Authority, which claimed that Alecta broke a number of regulations when making investments in the failed businesses. At the end of June, Alecta received a letter with preliminary assessments from the FSA, to which the fund scheduled a response by September 6.  

“We have worked intensively on developing and implementing improvement measures to strengthen Alecta, while at the same time continuing to deliver high quality in the day-to-day operations for the benefit of the customers,” said Alecta CEO Peder Hasslev in a translated statement. “During the first half of 2024, the yield was competitive.” 

Alecta, the largest pension fund in Sweden, manages retirement benefits for 2.8 million beneficiaries, more than one-quarter of the country’s population.  

Related Stories: 

Alecta Reports 5.9% Q1 Return After Losing Billions on Regional Banks 

Alecta Board Chair Ingrid Bonde Resigns 

Alecta Fires CEO as Fallout Continues From $2 Billion Banking Losses 

Tags: , , ,

«