THE OVERALL value of Shetland Charitable Trust’s funds rose by £32 million over the last financial year to £232 million, trustees were told on Thursday.
A total investment return of £40 million was helped by a rise in the global equity market which was partly due to the proposed economic policies of new US president Donald Trump.
However, Candida de Silva from investment managers BlackRock told trustees via conference call that the market increase was “not the norm” and suggested the upturn was a temporary “sugar high”.
Thursday’s meeting in Lerwick meanwhile was the first without any councillor-trustees, with just six of the remaining ten members able to attend.
Last year Shetland Islands Council decided to no longer put forward any members as trustees, and the situation has not changed despite a new council forming in May.
There is currently one appointed vacancy following businessman Malcolm Younger’s u-turn on taking on the role.
The meeting saw four investment companies give trustees an update on the last financial year.
During the term, the trust disbursed £8.37 million into the local community.
De Silva said the expectation that Trump would focus on the domestic US economy and relax tax regulations – a strategy known as the ‘Trump trade’ – saw a rise in the equity market.
But she said there was perhaps too much confidence as he won the election in November and confirmed some of the increase has dropped off when investors realised the true picture.
Chairman Bobby Hunter asked investors Insight whether they had any concerns about the forthcoming Brexit process.
They said that they were confident about keeping up their “consistent” record in returns.
Trustee Andrew Cooper meanwhile questioned Baillie Gifford – who look after 38 per cent of the trust’s reserves – about how it views the financial ethics of some of the companies it invests in, such as Amazon.
Director Tom Wright said they would “tell them the concerns” of investors. “It’s about what they do, not what they say,” he added.
Colleague Aileen Lawless added that one company they have been putting money into is Nvidia, known for making computer graphics cards, because they are exploring virtual reality technology for the likes of self-driving cars.
Schroders, who are involved in property, said they have brought an additional £2.1 million per annum to the trust’s £19.5 million investments since 2009.
Speaking after the meeting, Hunter said: “Despite all the political upheavals in the world, the markets have performed well over the past year and the trust’s investments have made very healthy returns.
“But as we know from experience, the markets can fall and that can mean the numbers don’t look so good.
“It’s important to look at the long-term performance of the investments when we are assessing our financial strategy.”
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