Norway's Gjedrem on wealth management

"The investment strategy has so far aimed at low return volatility, perhaps to a larger extent than is reasonable for a fund that is meant to be permanent," said Svein Gjedrem, governor of Norges Bank, which manages the $248bn fund.

"The strategy is currently under review by the Ministry of Finance and there may be changes under way."

Since Norges Bank Investment Management (NBIM), the investment arm of the central bank, was set up in 1998, returns have beaten the benchmark in 25 out of 34 quarters, said Mr Gjedrem.

He added that, on average, the NBIM had earned exactly half a percentage point higher return per year than the benchmark portfolio. In nominal terms, that adds up to somewhere between $4bn and $5bn in extra earnings since 1998.

Speech by Svein Gjedrem, governor of Norges Bank to a panel discussion in Singapore on "Problems of Plenty? Challenges and Opportunities from the Accumulation of Large Exchange Reserves and Windfall Revenue", arranged as part of the seminar program of the 2006 Annual Meetings of the IMF and the World Bank.

Click here to read the speech "Wealth management in a public setting"