“I don’t think anyone expected the fund to ever reach $1 trillion when the first transfer of oil revenue was made in May 1996,” said Chief Executive Officer Yngve Slyngstad of Norges Bank Investment Management (NBIM), who manages the fund on behalf of the people of Norway.
“Reaching $1 trillion is a milestone, and the growth in the fund’s market value has been stunning,” he added.
The value of the fund, measured in dollars, has increased this year due to a strengthening of the world’s major currencies against the U.S. dollar and higher climbing stock markets, said MBIM.
The fund, which is in Norway known as “the oil fund” was established over 20 years ago in order to invest long term revenue from oil extraction.
This was done in order to save money for future generations.
“One day the oil will run out, but the return of the fund will continue to benefit the population,” explains the fund.
A Reuters calculation showed that the fund hit the milestone valuation of one trillion dollars was reached on September 19 at 02.01am in Oslo.
The value of the fund is the equivalent to around 1,47 million Norwegian kroner for each of its 5.2 million citizens.
Norway’s sovereign wealth fund, which has grown faster than ministers ever imagined, is now the world’s largest.
The fund owns on average 1.3 per cent of every listed company in the world, and around 2.3 percent of all those listed in Europe.
It currently holds assets in 77 countries and almost 9,000 companies.
At the end of 2016, about half of the fund’s assets were due to the returns on its investments.
Around 45 per cent was due to inflows from oil and gas revenues, and the rest due to currency movements.
Meanwhile, the fund has announced its support for the planned $74 billion merger of German industrial gases group Linde and U.S. peer Praxair , it said on Tuesday.
Together they would create the world’s largest supplier of industrial gases.
“Norges Bank Investment Management has tendered all shares held in Linde AG in connection with the business combination between Linde AG and Praxair Inc,” the trillion-dollar fund said in a statement.
“We support the strategic rationale for the merger… the proposed business combination is in the best long-term interest of Linde AG shareholders,” it added.