GOVERNMENT PENSION FUND GLOBAL

Transcription

1 GOVERNMENT PENSION FUND GLOBAL ANNUAL REPORT 215 PRESS CONFERENCE OSLO, 9 MARCH 216

2 Market value As at Billions of kroner 8, 7, Value Percentage share Equity investments 4, Fixed-income investments 2, ,475 8, 7, 6, 5, Real estate investments , 5, Real estate investments 4, 4, Fixed-income investment 3, 3, 2, 2, Equity investments 1, 1,

3 Inflows Billions of kroner Inflow Average inflow since

4 Inflows and return Billions of kroner 1,2 1, Return 42 Inflows

5 Accumulated return As at Billions of kroner 3, 2,676 3, 2,5 2,5 2, 2, 1,5 1,5 1, 1, Return

6 Annual change in market value Billions of kroner 1,5 1,5 1, 1, Krone rate 5 5 Return Inflows -5-5 Total -1, , 6

7 Accumulated market value As at Billions of kroner 8, 2,676 8, 7, 7, 6, 6, 5, 1,331 5, Return 4, 3, 4, 3, Krone rate 2, 1, 3,468 2, 1, Inflow (after management costs) -1, , 7

8 Annual return Percent % 1 Annual return % -1 Accumulated annualised return since Q % % Last 1 years 5.3 % -2 Since %

9 Historical key figures Measured in the fund s currency basket. Percent 215 Last ten years Since Gross annual return Annual inflation Annual management costs Annual net real return

10 Relative return Percentage points Annual relative return Q % -1-2 Accumulated annualised relative return % Last 1 years.6 % -3-4 Since %

11 Decomposition of relative return 215. Contributions. Percentage points Total.45 Equity investments.52 Fixed-income investments

12 Contributions to relative return Strategies measured stand alone. Percentage points Strategy Equity Fixedincome Cross Asset Allocation Total Internal Reference Portfolio Allocation Securities Selection Asset Management Total

13 Expected absolute volatility Billions of kroner (left axis) and percent (right axis) Risk measured in kroner Risk measured in percent dec dec

14 FINANCIAL MARKETS IN

15 Price developments in equity markets Measured in USD (Stoxx in EUR). Indexed ( = 1) FTSE Global All Cap (global) FTSE Global All Cap (global) S&P 5 (USA) Stoxx Europe 6 (Europe) MSCI Asia Pacific (Asia) 4Q % 6 % 5 % 7 % % -1 % 7 % -4 % Stoxx Europe 6 (Europe) MSCI Asia Pacific (Asia) S&P 5 (US) 8 8 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Source: Bloomberg 15

16 Price developments in emerging equity markets Measured in USD. Indexed ( = 1) FTSE EM 9 9 S&P S&P 5 FTSE EM 4Q % % % -18 % Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Source: Bloomberg 16

17 Equity markets in China and Brazil Measured in local currency. Indexed ( = 1) Shanghai Stock Exchange Composite Index Hong Kong Hang Seng Index 75 Shanghai Hong Kong São Paulo 4Q % 5 % -4 % % -7 % -13 % 5 5 Dec-14 Mar-15 Jun-15 Sep-15 Dec Ibovespa Brasil Sao Paulo Stock Exchange Index Source: Bloomberg 17

18 Price development in stock sectors Measured in USD. Indexed ( = 1) Health Consumer goods Materials 9 8 Health Consumer goods Materials Oil and gas Technology Utilities 4Q % 6 % 3 % % 8 % 1 % % 5 % -17 % -22 % 3 % -7 % 7 7 Dec-14 Mar-15 Jun-15 Sep-15 Dec Oil and gas Technology Utilities Source: FTSE 18

19 Low interest rates 1-year government bonds. Percent 5 4 Germany US Japan UK Spain Italy % 2.3 %.3 % 2. % 1.8 % 1.6 % % 2. %.4 % 1.8 % 1.9 % 1.6 % % 2.2 %.3 % 1.8 % 1.6 % 1.9 % Germany US Japan UK Spain Italy -1-1 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Source: Bloomberg 19

20 Two year government bond yields Increasing in the US, decreasing in Germany. Percent US Germany Japan Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Source: Bloomberg 2

21 Price developments for fixed-income sectors Measured in USD. Indexed ( = 1) Government bonds Government related bonds Inflationlinked bonds Securitised debt Government bonds Government related bonds Corporate bonds Inflationlinked bonds Securitised debt 4Q % -1 % -1 % -2 % -1 % % -5 % -4 % -5 % -1 % 9 9 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Corporate bonds Source: Barclays 21

22 Currency development Weaker EUR, CHF and CNY in Dec-14 Mar-15 Jun-15 Sep-15 Dec USD/EUR (left axis) CHF/EUR (left axis) CNY/USD (right axis) Source: Bloomberg 22

23 Currency development emerging markets Measured against USD. Indexed ( = 1)* 15 BRL RUB INR TRY CNY 15 4Q % -1 % -1 % 4 % -2 % % -18 % -5 % -2 % -4 % 125 Brazil India 1 1 Turkey China Russia Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 *Falling curve implies a weaker currency measured against USD Source: Bloomberg 23

24 New real estate investments in transactions in total US 7 transactions Total value 36,5 bn NOK. UK 2 transactions Total value 5,9 bn NOK. Europe 1 transaction Total value 1,3 bn NOK. 24

25 Real estate investments Market value at year end in billion kroner Listed real estate investments 1 1 Unlisted real estate investments

26 Real estate portfolio as at Currency and sector distribution CHF 3.8 % Other 2.1 % SEK.2 % Listed real estate investments 23. % EUR 21.8 % USD 44.3 % Other*.8 % Office 48. % GBP 27.6 % Logistics 18.8 % Retail 9.4 % * Bank deposits and other claims 26

27 Responsible investment 215 We worked on standard setting We voted at 11,562 general meetings We had 3,52 meetings with companies 27

28 Observation and exclusions in 215 Changes from to Exclusions Daewoo International Corp POSCO Genting Berhad IJM Corporation ZTE Corp Observation PT Astra International Tbk 28

29 Risk-based divestments Main category Theme 215 GHG-emissions Deforestation Water Social and governance Oil sands Coal extraction towards electricity production Cement production Coal-fired power generation Other Palm oil production in Malaysia and Indonesia Coal mining in Indonesia Coal mining in India Pulp and paper Gold mining General mining and precious metals Mountain-top removal Heavy construction Corruption Other and earlier

30 Environment-related mandates Investments in 224 companies Main category Sub-groups Number of companies Total (billion NOK) Low-emission energy & alternative fuels Renewable energy Low-emission energy Low-emission fuels Clean energy & efficiency technology Electricity production Transport Buildings Industry Natural resource management Water Waste management and emissions reduction Sustainable agriculture Other * *Includes cash 3

31 Management costs Basis points Management costs Management costs excluding performancebased fees

32 Market value and management costs Fees in million currency units 8 7 Market value NOK Costs NOK Costs USD Change % 23 % -4 % 8, 7, Market value* (bnnok, right axis) 6 6, 5 5, Costs (millnok, right axis) 4 4, 3 3, Costs (millusd, left axis) 2 2, 1 1, * Average market value in respective year 32

33 Number of employees by office Number as at * Shanghai 5 5 Singapore 4 4 New York London 3 3 Oslo Excl employees in subsidiaries 33

34 Number of employees Number as at * Norges Bank Real Estate Management 2 2 Norges Bank Investment Management Excl employees in subsidiaries 34

35 Submissions, documents and reports Categories Submissions to the Ministry of Finance Advice on the fund s investments Discussion notes Analysis which may form relevant background for investment strategy and advice to asset owner Asset manager perspective Views and reflections on issues topical for the financial industry Expectation documents The fund s expectations to companies within focus areas Position papers The fund s view on special topics within our ownership work Public reports 35

36 Reports Annual report press conference 9 March 216 Report on performance and risk press seminar 16 March 216 Report on unlisted real estate investments press seminar 13 April

37 Main points The return was 2.7 percent in 215 Equity Fixed income Real estate 3.8 percent.3 percent 1. percent The return on equity and fixed-income investments was.5 percentage point higher than the return on the reference indices The market value of the fund grew by 1,44 billion kroner to 7,475 billion kroner Asset allocation at the end of the year: Equity Fixed income Real estate 61.2 percent 35.7 percent 3.1 percent 37

38 GOVERNMENT PENSION FUND GLOBAL ANNUAL REPORT 215 PRESS CONFERENCE OSLO, 9 MARCH 216