Bloomberg — Pension funds in the Netherlands were the largest buyers of Colombia’s local debt last month after foreign investors returned to the Andean nation’s securities following a turbulent October.
Pension fund managers from the Netherlands, including Stichting Pensioenfonds ABP which is the biggest, bought a combined 887 billion pesos ($186 million) of the securities in November, according to data from the Comptroller’s office. Franklin Resources, Aviva Investors and Wellington Management were also net buyers of the Colombian securities, known as TES.
Overseas money managers were net buyers of 156 billion pesos of TES last month, according to data from the finance ministry.
That marks a return after foreign funds ditched the securities in October, spooked in part by President Gustavo Petro’s campaign promises to end new oil exploration in a country where fossil fuels account for about one half of exports. Finance chief Jose Antonio Ocampo has eased some of the market’s jitters by saying the government is still analyzing if new oil contracts are needed.
Foreign funds are the largest holders of TES with almost 27% of the total, followed by local pension funds with 25%.
Dutch pension funds hold a combined $2.9 billion of the peso bonds, making them the largest investors in the Colombian securities. The increased positions in the Latin American country’s debt comes at a time when the Netherlands is overhauling its pension legislation, which will allow providers to take more risk when investing contributions from younger participants.
Singapore —combining the holdings of the government and central bank— and Norges Bank, which manages Norway’s sovereign wealth fund, remain among the top holders of Colombian securities. Funds managed by Franklin Resources Inc have also added to their positions this year, while Vanguard Group Inc and BlackRock Inc have been lowering their holdings of TES in recent months.
Colombia is among the few countries in emerging markets that have seen net inflows from nonresident investors into local government bonds this year, according to data from the Institute of International Finance.
Colombia’s local bonds have lost almost 25% this year, the second worst performance in emerging markets after Hungary, according to a Bloomberg index which fell an average of 8.6% in the period.
--With assistance from Cagan Koc
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