The departing head of Norway’s state fund knows his successor well – in fact, a little too well. The handover of responsibility is on the line.
Hedge fund billionaire Nicolai Tangen is set to take over as head of Norges Bank Investment Management (NBIM) – Norway’s state fund. He is due to replace Yngve Slyngstad in September, who will move on after a dozen years at the top of the world’s largest state fund. Tomorrow, however, the committee at Norges Bank, which oversees the move at the top of the fund, will look into allegations that the recruitment has been tarnished.
The background to the talk is an expenses scandal that involved Slyngstad and Tangen, reported the «Financial Times» (behind paywall). The incumbent boss confessed that Tangen had invited him to a flight back from New York to Oslo in November 2019. Slyngstad had attended a seminar at Wharton School of Business in Pennsylvania organized by Tangen.
The Right Person for the Task?
The trip has given rise to questions about whether the nomination of Tangen was conducted properly – and if the wealthy founder of hedge fund Ako Capital is the right person to take charge of $1 trillion worth of assets that belong to the people of Norway.
The discussion is particularly sensitive because NBIM is keen on sustainability and good governance. With the sheer size of its investments, the Norwegian central bank is probably the second-largest investor in Swiss shares after Blackrock, not least in stocks of financial-services firms.
Well-Connected Among the Elite
NBIM holds stakes in private banks Julius Baer and Vontobel, insurers Zurich, Swiss Re and Swiss Life as well as UBS and Credit Suisse. Norges Bank for instance has a 5 percent stake in Credit Suisse and owns its Uetlihof offices since 2012. It also holds about 3 percent of UBS.
Slyngstad is full of remorse. He acknowledges that he should have used a flight paid for by his employer instead of accepting Tangen's invitation. NBIM meanwhile emphasized that the incumbent head of fund wasn’t involved in selecting his successor – it is well known that Tangen is well-connected.
The tasks awaiting the new boss will be challenging in any case. For the first time in its history, NBIM will sell assets to plug the gap in the government’s budget that arose as a consequence of the coronacrisis. The collapse of the oil price has further aggravated the crisis, according to a «Bloomberg» report.
