Singaporean sovereign wealth fund Temasek Holdings has ramped up its bets on Chinese financial plays last year despite downgrades by foreign investment banks and the lackluster performance of stock markets in Hong Kong and the mainland.
Industrial and Commercial Bank of China Ltd. (01398.HK, ICBC), Ping An Insurance (Group) Co. of China Ltd. (02318.HK), China Pacific Insurance Group Co. Ltd. (02601.HK), and AIA Group Ltd. (01299.HK) were on the “overweight” list, the Hong Kong Economic Journal reported on Wednesday, citing the government investment vehicle’s latest annual report.
As of the end of March, Temasek’s portfolio has risen 3.7 percent from a year ago to S$223 billion (US$179.37 billion), with China being the second largest market in terms of the fund’s asset allocations. The proportion of its China portfolio stood at 25 percent of the total, just second to the home country Singapore’s 31 percent.
Temasek’s holdings of ICBC’s H shares increased to 8.9 percent during the year, representing 2 percent of the overall issued capital shares of the world’s most profitable bank.
Its stakes in China Construction Bank Corp. (00939.HK) and Bank of China Ltd. (03988.HK) stood at 6 percent and less than 1 percent respectively.
Shares in AIA and Ping An both rose two percentage points to 4 percent and 3 percent respectively.
The fund also disclosed for the first time its interest in China Pacific Insurance, which came in at 2 percent.
Analysts said Temasek’s holdings in Chinese financial enterprises were long-term investments that also resulted from political considerations. The fund has been given quotas under that Qualified Foreign Institutional Investor scheme.
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