GIC released its annual report for the year to March 31 2015, when it saw improved investment returns. But the outlook will be choppy going forward, it warned. The Straits Times sums up the key facts on GIC and its latest performance.
Better long-term return
For the year to March 31 2015, GIC reported a 20-year real return rate of 4.9 per cent per year, up from 4.1 per cent reported in the previous year. This was the result of rising asset prices in the global bull markets in recent years after the 2008-2009 Financial Crisis.
Chief investment officer Lim Chow Kiat cautioned at a briefing on Wednesday: "Going forward, we see a more difficult investment environment, largely because the broad market valuations are high. It's not simply because markets have gone up, but also because fundamentals in many markets have not kept pace with their rising prices… We see that as posing difficulty in the next five to 10 years in terms of market returns."
Still a global heavyweight
GIC is one of three entities - alongside the Monetary Authority of Singapore and Temasek Holdings - tasked with managing and investing Singapore's reserves. Globally, GIC is the world's eighth largest sovereign wealth fund with around US$344 billion of assets under management, according to the Sovereign Wealth Fund Institute.
Asset mix largely unchanged
As of March 31, GIC's portfolio comprised of 32 per cent of nominal bonds and cash, 29 per cent of developed markets equities, 18 per cent of emerging markets equities, 9 per cent of private equity, 7 per cent of real estate and 5 per cent of inflation-linked bonds. The make-up is largely similar to the previous year despite changes in market conditions, reflecting GIC's focus on the long-term horizon.
Deputy Prime Minister Teo Chee Hean became the chairman of GIC International Advisory Board on April 8. Mr Teo was previously the board's deputy chairman, and his new appointment came after the passing of former chairman Mr Lee Kuan Yew. Former Keppel Corp chief executive Choo Chiau Beng was appointed a member of the GIC Investment Board on April 28.