Japanese pension fund posts $114b profit in Q4


Japan’s Government Pension Investment Fund (GPIF), the world’s largest pension fund, on Friday reported a profit of 9.1 trillion yen (S$114.4 billion) in January-March, swinging from a record loss in the prior quarter, thanks to an upturn in stock markets. The fund, which managed 159.2 trillion yen of assets as of end-March, had quarterly profits of 2.7 trillion yen on domestic stocks and 5.1 trillion yen on foreign equities, its earnings results showed. Japan’s Nikkei stock average rose 8.4 per cent during the quarter, boosted by speculation the US Federal Reserve’s next policy move would be an interest rate cut. —VoM
The GPIF had suffered a record 14.8 trillion yen loss in the three months ended in December as worries about the escalating US-China trade war battered global markets. Given the ultra low interest rate environment in Japan, the fund has retreated from unprofitable domestic bonds and pushed into foreign assets.
It had 26.3 per cent of its portfolio in Japanese bonds as of end-March, compared with 36.15 per cent in September 2016 when the Bank of Japan launched its policy of pinning 10-year government bond yields around 0 per cent. By contrast, the GPIF’s foreign bond holdings accounted for 16.95 per cent of its portfolio in the latest quarter. It bought a net 630 billion yen of foreign bonds during the quarter, according to a Reuters calculation based on the fund’s results. The fund allocated 23.55 per cent to domestic stocks and 25.53 per cent to foreign stocks.

The CPHGC is a joint venture between China Power International Holding Ltd (CPIH) and Hubco under which development, construction and operation of 2x660MW imported coal-fired power plant is being funded by the two companies. Both units of the CPHGC have been synchronised with the national grid and the project is expected to start its commercial operations by August 2019.
With the aim of fueling lives through energy, the Hub Power Company Limited currently produces over 1,600 megawatts through its three plants located in Hub at Baluchistan, Narowal in Punjab and Mirpur in Azad Jammu and Kashmir. This generates around 8 percent of the total power generation capacity in the country.
The company is the only power producer in Pakistan with four upcoming projects listed in the China-Pakistan Economic Corridor (CPEC), and currently, under-construction, namely imported coal-based China Power Hub Generation Company (Private) Limited (CPHGC) at Hub, Thar Energy Limited (TEL) and Thalnova Power Thar (Pvt) Ltd and Sindh Engro Coal Mining Company (SECMC) at Thar Block II. The power generation capacity of the company will enhance to over 3,580 megawatts after completion of the aforementioned power project.

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