Channel News Asia- Sovereign wealth funds (SWFs) are currently worth about 1.3 percent of total global financial assets. But at US$2.2 trillion, they have surpassed the value held by private equity and hedge funds.
Based on current trends, studies suggest that sovereign wealth funds will overtake forex reserves and grow to about US$13 trillion in the next decade.
Recent massive injections in large banks like Merrill Lynch attest to the positive and stabilising force that sovereign wealth funds wield as they have provided sorely-needed cash and helped to avert a collapse in global financial houses.
Tony Tan, deputy chairman & executive director, Government of Singapore Investment Corp, said: "If they were not able to raise capital from SWFs, where’s the capital to come from? There’s no option for them, they need capital."
