Norway’s SWF Posts Profit of $76.4 Billion in Q3-2024

Norway’s sovereign wealth fund – Government Pension Fund Global (GPFG) – the largest fund in the world managing assets to the tune of $1.7 trillion, on Tuesday said that it has recorded a profit of $76.4 billion in the third quarter of 2024. In the first half of 2024, the Fund returned 8.6%, equivalent to $134.73 billion.

The fund’s total return for the third quarter was 4.4%, 0.1 percentage points below the benchmark index set by the Norwegian Finance Ministry, which is based on the FTSE Global All Cap and Bloomberg Barclays indices.

Releasing the Q3-2024 financial results, Trond Grande, deputy CEO of Norges Bank Investment Management (NBIM), which oversees the fund, said that the strong performance to gains across all investment sectors, driven by falling interest rates that spurred a significant rise in equity markets. “We had a positive return across all our investment areas. Falling interest rates led to a broad rise in the stock market. The depreciation of the Norwegian krone against major foreign currencies further boosted the fund’s value in the third quarter,” Grande said.

The sovereign wealth fund, established in 1990 and often referred to as the Oil Fund, has been growing through investments in foreign stocks, bonds, and real estate using returns from Norway’s oil and gas production. While the government can draw small portions of the fund’s revenues, the bulk is saved for future generations.

Currently, the fund owns almost 1.5% of all shares in the 8,763 listed companies across 71 countries, and they are tied to the fund’s investments. In recent years, the fund has also expanded its investments into renewable energy projects.

It also owns hundreds of buildings in major cities worldwide and an offshore wind farm, and receives additional income from lending to countries and companies​​. The extensive equities portfolio includes stakes in companies such as Apple, Nestle, Microsoft, and Samsung.

AUM Around $1.7 Trillion

NBIM said the fund’s value rose to over $1.7 trillion by the end of September following a third-quarter return on the fund’s equity investments of 4.5%, the return on the fixed income investments was 4.2%, whereas investments in unlisted real estate returned 0.8%. The return on unlisted renewable energy infrastructure was 10.8%.

The krone weakened against several of the main currencies during the quarter. This contributed to an increase in the fund’s value by $17.41 billion. In this third quarter, inflow into the fund amounted to $9.03 billion.

According to NBIM, 71.4% of the fund was invested in equities, 26.8% in fixed income, 1.7% in unlisted real estate, and 0.1% in unlisted renewable energy infrastructure.