June 12, 2020 / 2:52 PM / a month ago

Norway lawmakers to scrutinise hiring of new wealth fund head

OSLO, June 12 (Reuters) - Norwegian lawmakers will scrutinise the appointment of hedge fund veteran Nicolai Tangen as head of Norway’s $1 trillion sovereign wealth fund, the opposition Labour Party said.

Norges Bank said in March that Tangen would take over the running of Norway’s $1 trillion rainy day fund from September, while putting his own 43% stake in London-based AKO Capital into a blind trust.

The Norwegian sovereign fund, the world’s largest, owns about 1.5% of all listed global equities and is worth three times Norway’s annual gross domestic product, making its investment returns vital to the country’s economy.

Deputy Labour leader Hadia Tajik told the NTB news agency on Friday that the Norwegian parliament’s finance committee will hold a hearing in August to investigate the hiring process.

The hearing was prompted by a letter from the central bank’s supervisory board to parliament, reiterating concerns first raised last month with regards to Chinese walls between Tangen’s new role and his business interests.

In a statement on Thursday, the central bank again said conflicts of interest had been prevented.

“The employment contract creates sufficient distance between Nicolai Tangen’s private finances, the AKO system and the job that he will carry out as CEO,” Olsen said.

On Friday, following news of the hearing, the central bank said it would testify before the committee.

“Norges Bank is of course prepared to give any clarifications to parliament regarding the hiring,” a spoksman for the bank said.

Norwegian central bank governor Oeystein Olsen has said Tangen’s employment contract creates sufficient distance between his interests and the fund, and that the relevant mechanisms for managing the situation will be in place by the time he starts.

Tangen’s surprise appointment thrust the 53-year-old, whose private wealth is estimated at more than $500 million, into the limelight in Norway.

Overturning his appointment would likely require the government to replace Olsen and others on the central bank’s executive board, which was unanimous in choosing Tangen. (Reporting by Victoria Klesty; Editing by Terje Solsvik and Alexander Smith)

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