Global Financial Market Review

Kuwait’s Public Institution for Social Security posted a record first-quarter investment profit following a reboot of its strategy as the pension fund put behind a corruption scandal involving a previous manager.

The fund, which owns 25% of US private equity firm Stone Point Capital, had an investment profit of $7.3 billion in the three months through June, it said in a statement. That compares with about $4.4 billion for the fiscal year through March 2019, when it last released data.

A new management team was brought into the fund in 2017 to transform the state-owned institution after its former head was found guilty of personally profiting from the organisation over decades.

The performance is “undoubtedly a turning point” for the institution, which is “reaping the fruits” of its new investment strategy, Raed Al-Nisf, deputy general manager for investments and operations, said in the statement.

That strategy, with advice from Cambridge Associates, has seen the fund reduce its cash available for investments to 11.5% by the end of June, from 37.2% at the end of March, 2017, he said. It aims to reduce that to 4% by the end of March 2021.

The fund, which held $112 billion in assets at the end of March last year, also owns a 10% stake in New York-based buyout firm TowerBrook Capital Partners, and has holdings in more than 40 stocks on the Boursa Kuwait.