Investments at PIC plunge 6%
Assets slipped by R46.8bn
October 9, 2009
By MZWANDILE JACKS and Bloomberg
The Public Investment Corporation's (PIC) value of investments sagged 6 percent in the year to March and the value of assets under its management dropped by R46.8 billion to R740bn, the state-owned fund manager announced yesterday.
Analysts said fund managers, such as Old Mutual and Sanlam, did not escape the wrath of the global economic downturn during this period.
This meant that they too had seen their equity investment portfolios taking a hard knock, analysts said.
Bloomberg reported that the company's portfolio of listed stocks had dropped 27 percent to R270bn.
Experts said this figure was slightly better than the all share index, which shed 28.5 percent in the year to March.
Chief executive Brian Molefe said equity investments were the only problem otherwise bonds, cash, property and Isibaya, which is PIC's private equity fund, performed well during the period. "Now since March this year the equity market has done very well.
"This means that we do not have to change anything going forward. We will stick to what we have done best. All that happened was not because of us or our strategy but market conditions, which were beyond our control," said Molefe.
Lynn Bolin, the head of media and communication at Old Mutual Investment Group South Africa, said it was impossible for the company to give the total figure of the performance of its investment portfolios.
Bolin said the company was not one big group that ran one equity portfolio. It had over a dozen boutiques running many portfolios each, making it impossible to tally figures.
Sanlam Private Investments (SPI) also could not give specific overall figures.
Alwyn van der Merwe, the director of investments at SPI, said Sanlam Investment Management (SIM) managed multiple portfolios with very diverse benchmarks.
"It's impossible to provide a figure," said Van der Merwe.
Analysts said Old Mutual and Sanlam's investment values have suffered the same fate as the PIC's. Old Mutual said its assets stood at R398bn in June this year. It could not say whether this had dropped or not.
Steve Meintjes, a senior analyst at Imara SP Reid, said the PIC's investment portfolios had a double hit, "it was the economic crisis and the fact that the PIC, itself, withdrew its mandates", said Meintjes.
Earlier this year, the PIC said it would withdraw a quarter of its assets from funds including those owned by Sanlam and Old Mutual and hand over this business to fund managers with greater black ownership.
Patrice Rassou, a senior portfolio manager at SIM, said the period under review was the "worst period" and none would have survived it. "We only managed to see the recovery in portfolios some time in March. So the 12 months to March affected the value of all investment portfolios," he said.
|
|
