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Q3 2020: NOK 15 billion in earnings

The Government Pension Fund Norway, which is managed by Folketrygdfondet, achieved a return of 5.8% in Q3 2020, 0.4 percentage points better than the market return. The fund capital totalled NOK 272 billion at quarter-end. The Government Bond Fund – also managed by Folketrygdfondet – was invested in 69 bonds at the end of Q3.

Government Pension Fund Norway

The return on the Government Pension Fund Norway (GPFN) totalled 5.8% in Q3, 0.4 percentage points higher than the benchmark index. The quarterly return on the equity portfolio was 8.8%, 0.3 percentage points above the equities benchmark index. The return on the fixed-income portfolio was 1.2%, 0.4 percentage points better than the fixed-income benchmark.

“We are very pleased that the equity portfolio and fixed-income portfolio both outperformed the market in the third quarter,” says Folketrygdfondet CEO Kjetil Houg.

Over the past 10 years, the GPFN has achieved an average annual return of 8.2%, beating the market by 0.7 percentage points per year.

Government Bond Fund

Folketrygdfondet has been responsible for managing the re-established Government Bond Fund since 27 March 2020. The Bond Fund is intended to provide liquidity and access to capital in the bond market in the aftermath of the Covid-19 outbreak.

As at 30 September 2020, the Government Bond Fund had a total of NOK 6.1 billion invested in 69 bonds from 50 different issuers. Since being launched, the Government Bond Fund has generated earnings of NOK o.2 billion, including NOK 0.1 billion in Q3. The return on the fund since launch is 6.0%, including 2.3% in the third quarter.

“Folketrygdfondet is taking on substantial risk on behalf of the Government Bond Fund, as we are mandated to do,” says Kjetil Houg.