CIC gets 10.6% yield for overseas assets

Updated: 2013-07-27 09:59


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BEIJING -- China Investment Corporation (CIC), the country's sovereign wealth fund, announced on Friday in an annual report that its overseas investment portfolio realized an annualized rate of return of 10.6 percent in 2012.

The figure brings the company's accumulative annualized rate of return since its 2007 establishment to 5.02 percent.

CIC said in an online statement that relatively good returns in 2012 were due to its timely response to market opportunities, as well as effective risk management.

By the end of 2012, the company's total assets stood at $575.18 billion, with yearly net profits of $77.40 billion, according to the report.

CIC was founded in September 2007 with a registered capital of $200 billion. It aims to make better use of China's large foreign exchange reserves.

The company's purchase of shares of US firm Blackstone Group L.P. in 2008 and the stakes it acquired from investment bank Morgan Stanley in 2010 in the form of convertible bonds both reportedly incurred losses, sparking doubts about its profitability.

Four previous annual reports showed that its annual rate of return stood at -2.1 percent, 11.7 percent, 11.7 percent and -4.3 percent, respectively, from 2008 to 2011.

In 2012, the sovereign fund raised the proportion of open market share purchases, and steadily carried out long-term investment, including that in the infrastructure, energy and real estate sectors, according to Friday's report.

By the end of last year, long-term investments and open market stocks respectively accounted for 32.4 percent and 32 percent of CIC's total overseas investments.

The CIC is fully invested, company spokeswoman Liu Fangyu said, adding that the fund is also able to adjust its portfolio and liquidate its investments at any time.

Liu said the company secured a state cash injection of $19 billion in 2012 in addition to $30 billion of funds added in 2011.

CIC's latest overseas investments include purchasing a 10-percent stake in British Heathrow Airport Holdings and 5.3 percent of the Moscow Exchange.