Norway’s govt to consider framework for withdrawal of assets from GPFN

The Norwegian Ministry of Finance has revealed it is considering a new framework for the withdrawal of assets from the Government Pension Fund Norway (GPFN).

In a government white paper on the Government Pension Fund, which is formed of the Government Pension Fund Global (GPFG) and the GPFN, the ministry stated that shares the latter holds on the Oslo Stock Exchange have reached a level where there is risk of breaching the 15 per cent ownership share limit for individual companies.

Folketrygdfondet, which manages the fund, has recommended reducing the share invested in Norway and instead, increase the allocation to Denmark, Finland and Sweden. The fund manager has also discussed alternative solutions, including expanding the scope for investment in unlisted companies pursuing listing, and withdrawals.

However, the Ministry of Finance has proposed to keep the allocation to Denmark, Finland and Sweden unchanged at 15 per cent.

“The Government Pension Fund also has a presence in the Nordics through the GPFG, and having two funds in the same market is in isolation not efficient. Increasing the GPFN allocation to the Nordics would magnify this issue,” the ministry reasoned.

Despite this, it believes that the challenge of high ownership shares in companies listed on the Oslo Stock Exchange should be resolved, fully or in part, through withdrawals from the GPFN. It said the withdrawals may take different forms, including lump-sum withdrawals and/or annual withdrawals

“A withdrawal from the GPFN will require further assessment. We will continue working on establishing the scope and framework for such withdrawals, in order to resolve the issue Folketrygdfondet has raised in a sound and appropriate manner,” Minister of Finance, Jan Tore Sanner, said.

The ministry will at the same time review whether the scope for investing the GPFN in unlisted companies seeking listing may to some degree be expanded.

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