Kuwait wealth fund under fire from local media and parliament for investing $5bn in banks.
Sovereign wealth fund Kuwait Investment Authority (KIA) said it focused on the long-term value of companies, not short-term fluctuations, when managing the Gulf Arab state's assets.
KIA has come under fire from local media and some deputies in Kuwait's parliament for investing $5 billion in US banks Citigroup and Merrill Lynch in January. The shares have fallen sharply since.
"KIA is a long-term investor by nature and does not look at temporary price fluctuations and is always keen on diversifying its portfolio of investments geographically and in type to reduce risks," KIA Managing Director Bader Al-Saad said in a statement on Sunday.
KIA said it was responding to criticisms that it had lost $1.5 billion on investments, but did not refer directly to either bank.
Shares of Citigroup have fallen almost 36 percent and Merrill Lynch 38 percent since KIA unveiled its investments in the banks on Jan 15.
KIA quoted Finance Minister Mustapha Al-Shamali as saying the value of these investments had fallen 7 percent to the end of the fiscal year 2007/08 on March 31.