Norway’s sovereign wealth fund, the world’s biggest, on Thursday reported negative growth as a scandal surrounding its new boss intensified.
The fund posted a negative return of 14.6 percent for the first quarter, equivalent to a loss of 1.35 trillion kroner ($127 billion, 117 billion euros).
Already in March the fund had announced major losses as global markets collapsed under the economic fallout from the COVID-19 pandemic.
The loss reported on Thursday was mostly in line with preliminary figures released on April 2, and Norwegian media instead focused on a scandal involving the fund’s new CEO Nicolai Tangen, set to take over from Yngve Slyngstad in September.
The appointment of Tangen, who currently runs the hedge fund AKO Capital in London, came under scrutiny after it emerged that he invited 150 people, including Slyngstad, to a three-day “dream seminar” in Philadelphia in the US.
Guests were treated to private jet flights, hotel nights, food and a private concert with Sting and Gregory Porter, according to newspaper VG.
The seminar was held in mid-November last year, only weeks after Slyngstad announced he would be stepping down. On March 26 the fund announced Tangen would succeed Slyngstad.
“I am really, really sorry,” Slyngstad wrote in a message to the fund’s employees this week, according to VG.
In the message he said he had failed the organisation and weakened the oil fund’s reputation.
On Wednesday, Norway’s central bank, which oversees the fund, held an extraordinary meeting at which governor Oystein Olsen briefed the supervisory council on the process leading to Tangen’s appointment.
The bank had on Tuesday published a statement detailing the hiring process as well as the relationship between Slyngstad and Tangen.
The bank said Slyngstad had been invited to take part in the seminar over a year before announcing his departure, and that he had not been involved in the recruitment process.
The central bank also said it had covered the cost of Slyngstad’s travel to the seminar, but not from Philadelphia back to Oslo, and was willing to cover all expenses retroactively.
Norway places its oil revenues in the sovereign wealth fund — commonly known as the “oil fund” but actually called the Government Pension Fund Global — which Oslo then taps to balance its budgets.