Managers scramble for CIC

Updated: 2008-01-05 09:01

China Investment Corp (CIC), the nation's $200 billion sovereign wealth fund, has received more than 100 applications from money managers to help it invest in global equity markets, a source said.

Related readings:
 CIC to support banks
 Minister: CIC to make prudent investment
 CIC to be stable force in global financial market
 CIC aims for overseas

Beijing-based CIC, Asia's largest sovereign fund, is taking applications until January 15. It will notify institutions directly after the deadline expires about whether they've been selected, the source said, declining to be identified.

"The potential for global fund managers is huge since CIC has a lot of appetite for foreign expertise," said Anny Wong, who helps run institutional sales at BOCI-Prudential Asset Management, which oversees about $5 billion and has submitted an application to CIC. "We're looking for CIC to be one of our most important clients."

CIC spent more than $8 billion last year purchasing stakes in Morgan Stanley, the second-biggest US securities firm, and Blackstone Group LP, manager of the world's largest buyout fund. The four-month-old fund may step up overseas investments this year as China encourages capital outflows to limit domestic asset price bubbles and inflation.

The Government of Singapore Investment Corp, which manages more than $100 billion of that nation's reserves, hires outside firms to run some of its funds. Temasek Holdings Pte, which oversees an additional $112 billion on behalf of the city-state, uses only its own fund managers.

Bai Xiaoqing, from CIC's Beijing communications office, declined to comment.

Firms were invited in December to apply for the chance to invest CIC assets in stocks on the MSCI All Country Index, MSCI EAFE Index, MSCI Emerging Markets Index and in Asia ex-Japan equities. They must have at least $5 billion of assets under management to be eligible, the sovereign fund said.

"CIC will likely focus on index funds and investments with quantitative strategies," said Howard Wang, who oversees $14 billion at JF Asset Management Ltd in Hong Kong.

(For more biz stories, please visit Industry Updates)