Five questions for Nambawan Super CEO, Paul Sayer

Super fund Nambawan Super is one of the largest sources of investment capital in Papua New Guinea. Paul Sayer was appointed CEO last August; he tells Business Advantage PNG about the fund’s approach to investments.

Nambawan Plaza under construction in downtown Port Moresby. Source: Business Advantage International

BAPNG: Nambawan Super has had a major role to play in driving domestic investment in recent years. Can you describe your investment strategies?

Paul Sayer: Nambawan Super has what’s called a strategic asset allocation, making sure you diversify [while] thinking about investment risk and the profile of the members. We continue to invest in PNG and we’re actually currently holding a fair proportion of our money in cash whilst we continue to look for opportunities.

There are certainly opportunities within the country, but we’re also in a growth phase of the Fund so we’re also looking at taking advantage of opportunities elsewhere internationally. To take advantage of those opportunities we need greater flexibility to buy foreign exchange to ensure we can invest at the right time in the right opportunities.

BAPNG: Things are quiet on the Port Moresby Stock Exchange, so is it really unlisted opportunities you’re looking for? Can you nominate some successful investments by the fund?

Nambawan Super’s Paul Sayer.

Sayer: We look for any investment opportunities that match our risk and return criteria but there are some opportunities for unlisted [companies]. These may include family businesses at a significant stage of growth. Where a business has outgrown its family ownership model and is ready to expand we can play the role of a private equity or venture capitalist to seize that opportunity. We only provide an equity investment, but we can also support those businesses as they grow to the next level, with stronger governance and a wider shareholding that provides returns to all Papua New Guineans.

We hold a large proportion of Paradise Foods so we’re involved in a business that’s continued to grow, that has also given a great return back to our members. Paradise Foods are a staple for many Papua New Guineans with their popular biscuits. We’re certainly in there and we’re seeing that business continue to grow. If and when it is looking for capital we’re there to support it if the investment is right. We also have other investments such as SP Brewery.

BAPNG: What about your property portfolio?

Sayer: We’ve built the new Deloitte Haus in Port Moresby, which is certainly a beautiful building. It will be part of a complex of three buildings including the Nambawan Plaza. The two other buildings going up next to Deloitte Haus will include residences. We own those and are building them in a joint venture with Lamana Development. This is a good building, a great location, and as we continue to secure more tenants it gives significant value back to the members.

The property market is not as healthy as what it was during the construction of the PNG LNG project. There’s probably some pressure on and some rents are easing but I know that if you’ve got a good building, a good outlook and everything else, people will want to be in those buildings and this provides a good diversified return.

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BAPNG: Are there new initiatives you’re looking at?

Sayer: One of the other important things we’re trying to do is think of the post retirement stage for our members. We’re looking to provide an income stream rather than giving them a lump sum that they will need to manage through their retirement. You’ll have a teacher who works for 30 years, receives 780 pays in their working lifetime, and then, realistically, they have got about another 580 ‘pay’ periods to use that lump sum.

One of the challenges for us is to actually encourage members to let us invest that lump sum so they can continue to access the power of our investment skills and can secure a regular income for them through their retirement.

BAPNG: Home ownership seems to be a big focus in PNG right now …

Sayer: Yes. Our membership certainly wants it, but there needs to be a balance. At the moment, you can actually borrow your own money back out of the super fund and put these funds towards a house. After five years in our fund, you can claim your own personal contributions back out and that can form the basis of a deposit, and then a bank can loan the rest of the money. Now, you’re expected to repay that amount back into the Fund.

As you’re seeing the country continue to develop, housing is one area that people are looking at to support their savings goals. The main objective of superannuation is to provide a benefit to assist upon retirement and for us, the ability for members to fund a sufficient lifestyle in retirement is important.

Comments

  1. Hosea ROBIN says:

    Is there any more Funding from the state soon as reimbursement so the exited members like can be paid off.

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