Norwegian domestic pension fund loses value
The value of the Norwegian government’s domestic pension fund declined 25 percent in 2008 to $12.3 billion due to collapsing stock prices during global financial turmoil, the national welfare administration Folketrygdfondet announced Feb 4, reports AP.
Norway divides its wealth into two pension funds; the domestic fund invests in Norway and other Nordic countries, while the vastly larger global fund, formerly called the oil fund, invests outside Norway.
The smaller domestic fund said the value of its Norwegian stocks fell 49 percent, and its Nordic shares value fell 33 percent during 2008. About 60 percent of its assets are invested in shares, so interest revenues from the 40 percent placed in government-backed bonds were not enough to offset the collapse of share prices, it said.
The separate global fund, which is managed by the central bank, will report its 2008 results next week. At the end of the third quarter, the global fund was worth was about $280 billion in worldwide stocks and bonds.
Norway produces about 2.2 million barrels of oil per day plus natural gas.
Source: International Herald Tribute.