Khazanah to increase foreign investments

KUALA LUMPUR: Khazanah Nasional Bhd., Malaysia’s sovereign wealth fund, plans to increase its overseas investments as it seeks to boost gains, a top executive said.

“We are still investing for growth,” managing director Tan Sri Azman Mokhtar said in a Bloomberg TV interview at the World Economic Forum in Davos.

The rate of return from foreign investments has been slightly higher than the fund’s domestic ventures, he said. “On the exact balance, at the moment we are constantly rebalancing.”

The fund is following its counterpart in Singapore in search of yields as investors worldwide grapple with inflated valuations and tighter liquidity. The Kuala Lumpurbased firm’s local investments account for 55.5 percent of the total realizable asset value in 2017, while the rest is in foreign ventures, according to a statement released earlier this month.

Khazanah’s total returns are represented by growth in net value of its portfolio, which expanded at a compounded annual rate of 9.6% since 2004 to a record RM115.6bil as of end2017, it said in a January statement.

By comparison, its foreign investments offer returns in “the mid-teens,” Azman said.

The company’s longterm strategy remains investing in South-East Asia as the region is geographically blessed with China and India as partners, he said.

The fund’s assets in Malaysia include stakes in some of the country’s biggest companies operating in sectors from health care to infrastructure, while its overseas investments span countries from China and Indonesia to regions such as North America.

Azman, whose term as managing director ends in May 2019, also said the company has a succession program in place and the preferred route is to promote internal candidates.

The company named Ahmad Zulqarnain Onn and Azmil Zahruddin Raja Abdul Aziz as deputy managing directors in December. — Bloomberg