Europe's biggest equity investor sticks to estimate
OSLO (Reuters) - Norway's sovereign wealth fund is sticking to its previous estimate for its year-end value, despite losses on the back of global financial turmoil, daily Aftenposten reported on Thursday.
The fund is the world's second biggest sovereign wealth fund and Europe's biggest equity investor.
The Government Pension Fund -- Global, known as the 'oil fund', invests Norway's oil wealth in foreign stocks and bonds to save for future generations. Stocks have been hit amid global financial woes, but high oil prices have boosted the value.
When presenting its revised 2008 budget in May this year, the red-green coalition government estimated the fund's value at 2.32 trillion Norwegian crowns by the end of 2008, revised from 2.47 trillion estimated in its draft budget in October 2007.
"The fact that we give the same estimate now that we did when presenting the budget (in May), I think will come as a surprise for most people," said Roger Sandum, the finance minister's adviser, according to Aftenposten.
"We have not performed so well when it comes to shares... but the result for bonds is not particularly bad," Sandum said.
In the second quarter, the fund grew 2.4 percent thanks to fresh injections of oil money, to 1.992 trillion crowns from 1.946 trillion at the end of the first.
But this was the third consecutive quarter with a negative return for the fund.
Third quarter investment returns at the fund are set to be worse than at any previous time, the newspaper said.
"This will be the worse result in one single quarter ever," said Finance Ministry official Martin Skancke.
In early September the ministry estimated the fund to be worth about $600 billion by 2011 and around $1 trillion by 2020.
(Reporting by Aasa Christine Stoltz; Editing by Anshuman Daga)
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