Moody’s Ratings highlighted Temasek Holdings of Singapore and Saudi Arabia’s Public Investment Fund (PIF) as the top performers among 11 government-owned investment holding companies (IHCs), citing their strong intrinsic credit metrics, excellent liquidity, and diversified investment portfolios. These qualities contribute to their standalone credit strength without the need for extraordinary government support.
Moody’s also noted Khazanah Nasional Bhd (A3 stable) of Malaysia as having strong intrinsic credit quality, supported by stable earnings from its key investee companies with leading market positions. Since adopting an active investment strategy in 2004, Khazanah has grown its net asset value at a compound annual growth rate of 5%, while maintaining prudent financial policies, including a leverage target of 30-35%.
However, Khazanah, along with four other IHCs, was flagged for weak liquidity, having insufficient internal cash sources to meet cash needs over the next 12-18 months. Moody’s noted that liquidity risks are mitigated by access to state-owned banks and capital markets, even during market volatility.
Temasek’s geographically diversified portfolio and its transparency in investment valuations provide stakeholders with visibility into market values and dividend income, making it one of the few global entities with low leverage and strong financial health.
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