- The Oxford Handbook of Sovereign Wealth Funds
- List of Figures
- List of Boxes
- List of Tables
- About the Contributors
- Introducing Sovereign Wealth Funds
- A Financial Force to be Reckoned With?: An Overview of Sovereign Wealth Funds
- Sovereign Development Funds: The Governance and Management of Strategic Investment Institutions
- From Financialization to Vulture Developmentalism: South-North Strategic Sovereign Wealth Fund Investment and the Politics of the “Quadruple Bottom Line”
- Sovereign Wealth Funds and the Resource Curse: Resource Funds and Governance in Resource-Rich Countries
- Sovereign Wealth Funds and the Global Political Economy of Trust and Legitimacy
- Sovereign Wealth Funds and Domestic Political Risk
- Sovereign Wealth Funds and Foreign Policy
- Sovereign Wealth and the Extraterritorial Manipulation of Corporate Conduct: A Multifaceted Paradigm in Transnational Law
- Sovereign Wealth Funds and Private Equity
- Co-Investments of Sovereign Wealth Funds in Private Equity
- The Use of Debt by Sovereign Wealth Funds
- Sovereign Wealth Fund Investment and Firm Volatility
- Sovereign Wealth Funds: Investment Choices and Implications Around the World
- The China Investment Corporation: From Inception to Sideline
- Investment Terms and Level of Control of China’s Sovereign Wealth Fund in its Portfolio Firms
- Strangers Are Not All Danger: Sovereign Wealth Fund Investment in the Energy Industry
- The Norwegian Government Pension Fund Global and the Implications of its Activities for Stakeholders
- Sovereign Wealth Fund Investments and Industry Performance: Evidence from Europe
- Spain and Sovereign Wealth Funds: Four Strategic Governance Types
- Sovereign Wealth Funds in Central and Eastern Europe
- Sovereign Wealth Funds in the Persian Gulf States
- The Australian Future Fund
- Is it Possible to Avoid the St Augustine Syndrome of Fiscal Procrastination?: The Case of Chile
Abstract and Keywords
This chapter documents the use of debt capital by sovereign wealth funds (SWFs)—a growing and under-researched phenomenon. Three reasons are given for this. First: debt can help SWFs reach their target portfolio size. (Some do not receive regular inflows from their governments to increase their assets under management (AUM). Second: the development of capital markets is a key objective for most of the countries that have created an SWF, and debt may be especially useful for the development of the bond market. SWF bonds are quasi-governmental securities that can be used as collateral and create a reference yield curve. Third: the use of debt capital is particularly appropriate for portfolio SWFs investing in concentrated portfolios of selected companies for strategic and financial reasons. SWFs are more likely to use debt when they are non-commodity-based, come from countries with relatively less developed bond markets, and have a strategic investment style.
Stefano Lugo, PhD is Assistant Professor of Finance and Financial Markets at the Utrecht University School of Economics. His research mainly focuses on sovereign wealth funds and on corporate debt, credit risk, and credit rating agencies. His work has been presented at several conferences, including the EFA annual meetings, and it has been published in academic journals such as the Review of Finance, Journal of Corporate Finance, and Journal of Banking and Finance, among others. He has held visiting positions at the Saïd Business School–University of Oxford, and at the University of Oklahoma–Price College of Business.
Fabio Bertoni, PhD is Professor of Corporate Finance at EMLYON Business School, France. His research focuses on the relationship between financing and firm performance, new listings, sovereign wealth funds, venture capital and corporate governance. He is author of articles in journals including: Journal of Corporate Finance, Journal of Banking and Finance, Research Policy, Small Business Economics, International Finance, and European Financial Management. He has held visiting positions at the Copenhagen Business School, Universidad Computense de Madrid, Centre for European Economic Research (ZEW) in Mannheim, and the University of Oxford—Saïd Business School.
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