Westpac KiwiSaver to dump Russian Government bonds
Monday, 28 February 2022
Westpac will sell all its Russian investments as sanctions are imposed on the country after its invasion of Ukraine.
The investments it will sell include Russian Government bonds, and a holding in Sberbank of Russia, which is 50 per cent owned by the Russian Government.
“In light of the current events and international sanctions against Russian entities, we are in the process of divesting all Government Bonds and Russian shares subject to sanctions across all our investment funds, including Westpac KiwiSaver,” a spokesman for BTNZ said.
BTNZ, which manages investments for the Westpac KiwiSaver scheme, said less than 0.1 per cent of its investments were in Russian companies and government stock.
**READ MORE:
* Why NZ Super Fund must dump Sberbank of Russia over Ukraine invasion
* US and British sanctions could force KiwiSaver funds to sell investments in Russian companies
* Main banks to offer relief to flood-affected customers
**
Westpac is not the only KiwiSaver scheme with Russian investments.
The ANZ and ASB KiwiSaver schemes also own a small amount of Russian Government bonds.
A spokeswoman for ASB said it, and its investment partner Blackrock, were actively assessing if ASB’s KiwiSaver Growth fund should continue to have exposure to Russian listed companies.
It's Russian investments accounted for 0.25 per cent of the fund's value.
The ASB KiwiSaver scheme’s latest portfolio holdings disclosure appears to show it even own bonds issued by Russian Railways, which is owned by the Russian state, and which international media has reported has been used to move Russian troops and supplies to facilitate the invasion of Ukraine.
The New Zealand Superannuation Fund, which was set up in 2001 to help pre-fund NZ Super payments, also has holdings in Sberbank, and several other Russian companies.
A recent portfolio breakdown from the NZ Super Fund showed it had just under $25 million invested in Russian companies at the end of June, with $9.3m in Sberbank, which was targeted with limited US sanctions following Russia’s 2014 annexation of the Crimean peninsula.
Since then the price of shares in Russian banks and companies has crashed as countries like the US and UK, and the EU trade block imposed sanctions on Russia.
A spokesman for the NZ Super Fund said the fund’s Russian investments were worth just $9m now.
He said: “NZ Super Fund holds approximately $9m of shares in companies from the Russian Federation covering retailing, media, telecommunication, banking and financial services, marketing, retail, chemical and mining companies.
“We are currently assessing the implications of Russia’s actions under our Responsible Investment policy regarding the Fund’s equity holdings and sovereign bonds. Any decisions will be implemented and then announced.”
Many of Russia's larger listed companies are oil and gas producers, and many KiwiSaver schemes, have ceased to invest in fossil fuels.
Over the Tasman, the New South Wales Government says it will drop A$75 million (NZ$80m) of Russian assets in one of its state investment funds.