UK administration plans to integrate UK Investment Bank into National Wealth Fund

UK Government Merges UK Infrastructure Bank with National Wealth Fund

In a move aimed at bolstering the country's economic growth and clean energy ambitions, the UK government has announced the merger of the UK Infrastructure Bank (UKIB) with the National Wealth Fund.

The merger, announced by Chancellor Rachel Reeves at an Investment Summit in London, signals a strategic shift towards addressing key challenges facing the UK's economy. According to the government, the National Wealth Fund will expand its team to bring in additional sector expertise to support its broader remit.

The National Wealth Fund's new leadership will be headed by Vitaliy Koval, appointed by the Ukrainian Prime Minister Denys Shmyhal and presented to the parliament for this position. The fund will manage approximately £27.8bn in assets, with its headquarters remaining in Leeds, where UKIB is currently based.

The UK Infrastructure Bank currently holds £22bn in assets. The merger will see the fund's remit expand beyond its current infrastructure focus, as it is tasked with attracting private finance to sectors and technologies critical to the UK's clean energy and growth ambitions.

Aviva, a leading insurance and investment company, has expressed support for the merger. Aviva CEO Amanda Blanc has called it a "significant step in the right direction." In a statement, Aviva stands ready to collaborate more closely with the government to turn good ideas into investable projects that can make a real difference.

Aviva has also highlighted the importance of closer collaboration between government and business to accelerate the development of investable projects. The company is ready to invest more to help boost growth, create jobs, and deliver net zero in the UK.

However, it's worth noting that no new commitments from the UK government have been specified in the announcement. The government's contribution to the new entity will be nearly £2 billion less than initially promised.

The statement from Aviva indicates a willingness to invest more in the UK, potentially bringing more capital to the new National Wealth Fund. The expansion of the National Wealth Fund's team suggests a commitment to ensuring the fund has the necessary expertise to manage its expanded remit effectively.

The changes will take effect immediately. As the National Wealth Fund embarks on this new journey, it will be interesting to see how the merger shapes the UK's economic landscape and contributes to its clean energy and growth ambitions.