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CIC chairman steps down – reports

Ding Xuedong, who set up the Chinese sovereign wealth fund’s direct investment unit in 2015, has left his post after close to four years with CIC.

Ding Xuedong, chairman and chief executive of China’s $810 billion sovereign wealth fund, China Investment Corporation (CIC) has stepped down from his post, according to a report from Caixin citing sources with knowledge of the matter.

It is not clear who will replace Ding and what his plans are after leaving CIC. Media reports, however, indicate that Ding’s departure from CIC signals he may be in line for a higher level post in the country’s economic team, ahead of a leadership reshuffle in Beijing’s five-yearly national congress late this year.

Ding took over from Li Jiqun who resigned in 2013 to join the Asian Infrastructure Investment Bank. Prior to joining CIC, Ding served as deputy secretary general at China’s State Council, from 2010 to 2013. He was also a former vice minister at the Ministry of Finance from 2008 to 2010.

Ding was responsible for steering the sovereign wealth fund’s pool of assets, created in 2007 to help China earn higher returns on its foreign exchange reserves, which to date amounts to $3 trillion.

Ding has been vocal about shifting CIC’s focus to global investments, particularly in the US. Under his watch CIC set up a new direct investment unit in 2015 called CIC Capital to more directly oversee the fund’s investments abroad. In the same year, CIC also moved its North America outpost from Toronto to New York.

Most recently in January this year, Ding told the Asian Financial Forum in Hong Kong that CIC would step up investments in US infrastructure and property, in order to better “manage global uncertainties by maintaining a diversified portfolio”.

CIC now maintains about 40 percent of its portfolio in alternative investments which includes private equity, real estate, infrastructure and hedge funds. In its latest annual report published in July last year, CIC said its proportion of co-investments and club deals in its portfolio rose, as the fund sought out more strategic partnerships with a “a few outstanding managers”.

CIC has been operating a standalone real estate group, called the Department of Real Estate, as of January 2016. The department is led by real estate head Zhi Wei Cai, a long-serving executive focused on real estate investments at the state fund.

In another indicator of its commitment to property, the fund, which managed approximately $740 billion of assets as of the end of 2014, according to its latest annual report published last summer, is understood to have doubled its allocation to real estate to 10 percent.

Most recently the investor acquired a stake in a New York office building for over $1 billion from the Canada Pension Plan Investment Board (CPPIB) in January.

CIC could not be reached for comment by press time.