Philippine state pension fund eyes resumption of overseas investments

MANILA, July 15 Mon Jul 15, 2013 4:42am EDT

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MANILA, July 15 (Reuters) - The Philippines' biggest state pension fund, absent from overseas markets the past two years, may re-enter them next year with a $300 million-$400 million investment given some signs the global economy is improving, its president said on Monday.

"A time has come for us to reconsider and deploy a portion of our assets externally, which would help dampen the volatility in our portfolio," Robert Vergara, president of the Government Service Insurance System (GSIS), told reporters.

"We are very careful about this... the earliest we will do, if we do so, is 2014," Vergara said.

GSIS began making overseas investments in 2008 - before the nadir of the global financial crisis - investing $600 million in stocks and bonds in countries such as the United States, United Kingdom, Germany, France, Japan and Australia.

The fund exited all its foreign placements in 2011 and reinvested the money locally to take advantage of higher yielding stocks and bonds.

Of as June 30, almost half of the fund's 730 billion pesos ($16.8 billion) in assets was invested in fixed income, while the share of equity investments was 16 percent. The rest of the portfolio was in loans to its members - comprised of government employees - and in properties and cash.

The Philippine stock market has risen about 14 percent this year, making it the second best performer in Southeast Asia after Vietnam. ($1 = 43.40 Philippine pesos) (Reporting by Karen Lema; Editing by Richard Borsuk)

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