SOFAZ expands list of banks within rouble portfolio diversification
Azerbaijan, Baku, Oct. 31 / Trend E.Ismayilov /
By late 2012, the State Oil Fund of Azerbaijan (SOFAZ) plans to increase its rouble portfolio to $300 million, SOFAZ reported Trend on Wednesday.
"Increase of the rouble portfolio to $300 million is possible by the end of the year. The final decision on this issue will be made based on the results of the analysis," the fund noted.
The fund reported that according to a new investment strategy, on October 19, 2012 the State Oil Fund began investing in assets denominated in Russian roubles. At present, the investment portfolio of SOFAZ includes only one short term deposit in the Russian Gazprombank to the sum of three billion roubles ($100 million).
The fund stressed that the list of the banks where deposits will be placed will be expanded in order to diversify the portfolio of the rouble, but there is not a specific list as such.
The currency structure of SOFAZ's investment portfolio is set as follows: 50 per cent of the assets can be placed in U.S. dollars, 40 per cent in euros and five per cent in pound sterling. The remaining five per cent of the total value of the fund's investment portfolio may be placed in the currencies of the Group of Seven, countries with long term ratings of at least A (Standard and Poor's, Fitch Ratings) and A2 (Moody `s), Russia and Turkey.
As of October 1, 2012, SOFAZ assets increased by 11.4 per cent, compared with the beginning of the year, reaching $33 192.4 million.
It is projected, according to totals of 2012 that SOFAZ assets will reach $34 billion.
SOFAZ was established in 1999 and at that time its assets amounted to $271 million.
The chief purpose of the fund is the accumulation of funds and placement of its assets abroad to minimise the negative impact on the economy, preventing a 'Dutch syndrome' to ensure savings for future generations and maintain the current socio-economic standard in the country.