Abu Dhabi Investment Authority (ADIA) has been knocked off the top spot as the world’s richest sovereign wealth fund by Norway’s Government Pension Fund, according to the most recent estimate by the Sovereign Wealth Fund Institute.
ADIA, whose assets range from Citigroup bonds to a stake in London’s Gatwick Airport, is thought to hold US$627bn assets under management as of October, US$29.2bn less than the Norway-based fund.
Norway’s Government Pension Fund was ranked the world’s largest fund with US$656.2bn of assets under management in the most recent update by the independent group.
Over one third of the world’s top 20 investment funds are currently based in the Middle East and own an estimated US$1.873.5bn of assets under management, said the report.
Saudi Arabia’s SAMA Foreign Holdings is ranked the Middle East’s second richest fund with an estimated US$532.8 worth of assets under management followed by the Kuwait Investment Authority in sixth place globally.
ADIA in June saw its long-term returns dip marginally over the course of last year against the backdrop of slow global economic growth.
In its annual report, the fund revealed that its 20-year annualised rate of return softened to 6.9 percent by the end of 2011, against 7.6 percent in 2010. ADIA’s 30-year rate of return remained exactly the same, at 8.1 percent.
As a matter of course, ADIA does not disclose its annual results.
In the report, ADIA managing director Sheikh Hamed Bin Zayed Al Nahyan stated that 2011 was a year “that reinforced our view of the important role that diversification and maintaining a long-term focus can play in safeguarding against unexpected risks and delivering sustainable returns”.
He also indicated that the fund was positive about the future performance of the global economy, despite the difficulties of the last four years or so.
“Despite facing undoubted short-term risks, the global economy offers many exciting and important opportunities,” Sheikh Hamed said.
“Economic advances require the input of capital through a range of vehicles, from private equity and direct investments to public equities, hedge funds and also government bonds.
“As a long-term investor, we see ourselves and others with similar investment horizons as providers of this necessary capital, with the advantage of patience and the ability to ride out dips in the economic cycle.”