Right, warm welcome. Who would have thought that with that backdrop the fund was now at the end of the year standing at more than 21,000 billion. And strong returns, third year in a row, 15% up, second third year with double-digit returns. And of course, given the size of the fund, the return in Norwegian kroner has been very strong. So we also had inflows last year, 327 billion kroner. That is a significant amount, albeit a little bit less than we've seen in the previous three years. So if you take those three things together, that's what determines the change of the value of the fund from the beginning of the year to the end of the year: the returns of more than 2,300 billion, the inflow of 320 billion, and then you have a stronger krone which weakens the value of the fund measured in Norwegian kroner.
We also released this morning a set of stress tests. So those are supposed to be scenarios which are somehow realistic and could have very severe impacts on the fund. So we have four scenarios. One is one we call AI correction, i.e. that you have a broad market selloff should the expected productivity gains and income from AI not materialize. We also have one scenario which we call fragmented world, and as you can understand, it's more about the world dividing into blocks. You have less trade between these blocks, you have increased inflation, you have lower growth, and that will also impact the portfolio severely, up to 37% as we model it. Third stress test scenario that you could envisage is a regional debt crisis. So what that means is that you have high government debt in many parts of the world, and if the investors lose confidence in the ability for governments to service that debt, they would start to move their capital out of those regions. Finally, we also have a fourth scenario which we call an extreme weather scenario. So here we try to model the impact of things like droughts, floods, storms, which would have impact on crops, which would feed through the value chain and lower growth and higher inflation as a consequence.
Relative returns negative 28 basis points, and we will explain just where that is coming from. Equities had positive seven basis points. Fixed income, very strong year. This is the bond portfolio, so really, really great numbers. Real assets, that's real estate. And the reason why those numbers are negative is because the real estate numbers have been flat. But what we measure it against is a combination of stocks and bonds. So it's the relative kind of result of one thing being flat and the other one continuing to go up, which is the result of that. And then allocation negative eight, that's mainly an underweight we've had in equities. So altogether negative 28 basis points since inception, still positive roughly 200 billion Norwegian kroner.
Yeah. So if you go through the different asset classes that the fund is invested in, the 15% on the overall fund is driven by first and foremost 19%, a very strong year in equity markets. That's the biggest part of our portfolio, 70% as a starting point. Also very good returns in our infrastructure portfolio of 18%, but that's the smallest part of our portfolio. In the middle, also positive returns for our fixed income portfolio, roughly 30%, and also on unlisted real estate.
Okay, equities up, as Tron said, 19%. And what's been going particularly strong here? Well, the whole market, after a dip in connection with the introduction of tariffs in the spring, the market had a pretty kind of smooth recovery and ended the year strong. When you look at what's been driving this, we've had basic material being particularly strong. You've seen what's happened to metal prices, gold, silver, copper, and so on, really driving that. Financials also strong. And then real estate being kind of the worst performing sector.
In terms of where the monetary gains come from, given that the technology sector is the largest sector and accounts for many of the biggest holdings, you'll see that the returns here are nearly 900 billion, financials nearly 700 billion, and industrials at 300 billion. And if you break that down even further by single companies and see the contribution from our single company investments, you see this top 10 list dominated by technology. Five of them US technology companies, but also a couple of other regions represented this year: Netherlands, South Korea, China. Yeah. And that means that, and we've spoken about this many times before, how the concentration risk of the portfolio has increased, and also through '25 increased even further. So these top 10 holdings, or the top 10 holdings of the equity portfolio, now constitutes 20% of that portfolio, and the highest level we've ever seen.
Okay. To explain some of the developments we've seen in the market, we are very pleased to have some of our analysts just tell you what's been going on in the market. And we start with Arnab calling in from New York. Arnab,
Good morning, Nikolai. Thank you. So for years, the world of bits and digits outperformed the world of atoms and molecules, perhaps because they couldn't be quarantined or tariffed. But in 2025, the metals in the periodic table made a very strong comeback. There are three main drivers behind this 40% plus return. First, inflation has eroded trust in traditional currencies. Hard assets such as gold have been climbing for years, but 2025 was exceptional with gold stocks rallying over 150% as central banks bought aggressively amid geopolitical uncertainties, wars, territorial ambitions, and trade disputes. The gold rally also spread to silver and other precious metals. Second, the world fears that we are running short on critical metals. Copper mines around the world have been having supply issues. Meanwhile, China controls most rare earth and downstream refining. So governments started asking, do we have secure supply? And the prices reflected this concern. Finally, AI needs physical infrastructure. Data centers and AI chips require enormous amounts of copper and other junior metals. This is adding to the fear around the demand-supply balances. So in summary, in uncertain times, investors and speculators turn to what is tangible and scarce. You can't print more copper or gold. And this fear and scarcity proved quite valuable in 2025.
Thank you so much, Arnab, that's very interesting. We move on to technology and we will hear from our portfolio manager Karina Sucha, who is a portfolio manager in hardware technology. Karina, are you with us?
Absolutely. Happy to be here. 2025 was another remarkable year for tech. Can you hear me? Okay.
2025 was another remarkable year for tech. As you saw, the sector gained over 20% and drove nearly 60% of total market returns. But under the hood, it was a year of exceptional volatility and wide gaps between winners and losers. Most of you may remember the DeepSeek sell-off in late January when investors were confronted with the introduction of high-performing Chinese AI models and began questioning Western dominance in AI. Liberation Day tariffs in April triggered another sharp sell-off, but was ultimately the starting point for a strong rise in stocks through October as investors rotated back into AI infrastructure. While the end of the year saw a growing number of large AI announcements from OpenAI, Oracle, and others, investors again began scrutinizing the size of these investments and started pointing fingers at what looked like circular funding between companies. Under the surface, not all tech was in the green last year. Semiconductor companies stood out as the relative winners, especially those that saw tight supply, while certain software companies underperformed as investors grappled with whether AI enhances or disrupts traditional business models. Among the tech giants, Alphabet stood out as a clear winner, reclaiming the AI crown, at least for now, with the successful launch of Gemini 3. The question moving into this year is how the adoption of AI will continue. Large companies around the world have started implementing AI tools at scale and are seeing meaningful productivity gains already. Over half of Fortune 500 companies are now using Cursor, the AI code editor. And ChatGPT now serves over 800 million users weekly. But the market isn't without risks, and we're bracing ourselves for yet another volatile year in tech, where debates around potential bubbles, profitability, power constraints, and competition with China will continue to dominate the conversation.
Thank you, Karina. We're moving on to financials and we have Phil joining us from London.
Hi there, Nikolai. It's a pleasure to be with you again. As your chart showed, financials delivered another strong year, up 30%. At the top of the list were the banks, big banks in the US like Citigroup and Goldman Sachs, but notably European banks, many of whom doubled during the year. And perhaps interestingly for you in the room, the European banks index has now outperformed the Magnificent Seven over the last five years. Why is this happening? So let's focus on the banks and I'll give you three reasons. Firstly, economies have continued to grow. This has fueled loan demand and has meant that debt servicing has remained very strong. Secondly, Wall Street is booming. This is a combination of volatility which is creating trading opportunities and rising corporate optimism which is fueling demand for mergers and acquisition services. And thirdly, regulators, politicians and banks are all aligned in trying to get their economies to grow. Where do we go from here? And this is a bit more tricky. Market now expects that banks will continue to grow their earnings in each year for the next three years. This needs Wall Street to keep going and economies to keep growing. This is certainly possible, but the bar is a lot higher given price movements. So on the team, we are taking less risk today than we were 12 months ago, and we have rotated at the margin into some of the less favored segments of financial services. Let's see if that works. But that's what I have for you today.
Thanks a lot, Phil. So we'll move from equities to fixed income now. That's roughly a third of the portfolio, or 27% to be exact. It had a strong year last year. We had 5% returns on our fixed income portfolio. And to talk about what happened in the fixed income markets, we have Guril Havu, who is head of fixed income Europe for us. Guril, please.
So 2025 was a year when a lot of things happened and yet fixed income markets were still for the most part, and with a major exception, relatively calm. So you had tariff shocks, AI revolution, geopolitical shocks, renewed fiscal concerns, and then uncertainty both about how these would actually play out, but also about how they would affect inflation, labor markets, monetary policy. So take AI. Is it going to lead to increased productivity, therefore lower inflation, therefore lower rates, or is it going to lead to increased investment, higher energy demand, and therefore higher rates? And so with many moving pieces, what are central bank policy makers weighing when they set their interest rates? So if you look at the market, there is sort of two main patterns in 2025 that I can see. And the first one, which is a smaller difference between the 10-year yields in large economies, that isn't necessarily strongly connected to either one of these shocks. So the highest yielders, the UK and the US, they saw their 10-year rates fall as central banks cut interest rates, and lower yielder Japan moved in the opposite direction. So yields rose as Japan raised rates but also as fiscal concerns mounted. And second, yield curves deepened significantly. So that is as central banks cut short-term interest rates, the gap between the short-term and the long-term costs widened. So that's due to increased uncertainty as well, changes to investor preference and also expected increased issuance. So take Germany for example, the ECB cut rates four times last year and yet German 10-year yields ended slightly higher than where they started, which was largely driven by expectations of increased government spending. So looking ahead to 2026, it's already clear that it will continue to be a year with more uncertainty and more shocks, and we look forward to following it.
Very good. Okay, real estate. So as you know, real estate has been an area where we have not performed well over the last few years. Last year the unlisted part were up 4% but the listed part was down four. So total result here is a big fat zero. We have made changes. We have a new strategy which is out and we also have new management running this. And we are pleased to have Alex with us from California. So pretty early for you.
Good morning. Thank you, Nikolai. So for real estate, 2025 was a year of relative stability after several years of turbulence in the markets really driven by the rise in interest rates. And so while an unexciting year was a relief for some, it still suffered, real estate that is, from a lack of relative appeal compared to those more exciting areas like tech. The one area that was hot in our space was data centers, and the exuberance there was seen every day. But aside from that, the sentiment was relatively muted. At the same time, listed real estate even gave back some gains from the prior year. The expectation of a recovery was brought forward in listed markets perhaps more than people expected. So the market has been looking for that sign of recovery. Where it's going to come from is almost certainly from what are actually quite strong occupational fundamentals. Rents have been gradually rising, development and new construction is subdued, and that is always a sign of a new recovery about to form. So we expect the fundamentals to continue to improve through the course of 2026. We expect our new strategy to be able to take advantage of sellers who now at the end of those years of turbulence need to sell. And so we're cautiously optimistic about the road ahead of us. Thank you.
Thank you, Alex. And thank you for staying up for us. So we'll round off this walk-through of the different asset classes with infrastructure for renewable energy. So this is an asset class that came into demand five years ago. We were deliberately slow in building up that portfolio but that has changed over the last few years. So now we're ramping up. We also built out the team. So we think we are in a very good position to build this portfolio even further. It had a very good year last year and to tell us more about that we have Haral Fon Hayen, who is our global head of energy and infrastructure. Haral,
Thank you, Nicolai. Yes, we are seeing that renewables are coming back into favor for sure. And also record pace of buildouts. Last year alone we saw a global buildout of 800 gigawatts of new renewable capacity. That's like adding 20 times of Norway's entire power production system in just one year. And this took Norway 125 years to build. Also, we saw that the share prices of several of the largest renewable energy companies in the world have stabilized or even moved up somewhat in 2025. Why? Well, the world needs more electricity for data centers, for AI, electric cars, heat pumps, and so on. We are seeing the electrification of everything. And wind and solar are still the cheapest and fastest way to add new capacity, now also supported by ever better batteries. This has created new bottlenecks such as the grid which is needed to move this clean energy to where people are. At NBIM we have invested more than ever in unlisted renewable energy in 2025, over 100 billion Norwegian kroner. We have now stakes in wind farm and solar farm projects around the world. We have a new partnership with RWE in 2025 which secured significant positions in the largest offshore wind parks in Europe. These two transactions alone more than doubled our portfolio. Our single biggest move in 2025, however, was to secure a 22% stake in TenneT Germany, Germany's largest TSO, transmission system operator. These transmission systems are critical for enabling the energy transition and for energy security. We'll continue to invest going forward where we find the most robust returns, mostly in mature technologies, stable countries and essential infrastructure. The energy transition is not going away. It gets less attention because it's become part of normal business but it's moving faster than ever. Thank you.
Thank you. Thank you, Haral. Okay, so we'll round off this press conference with the key points for '25. Another strong year, 15% returns. In accounting terms, that's more than 2,000 billion Norwegian kroner. So one of the strongest returns there as well. We were slightly behind the benchmark, 28 basis points, and the fund stood at more than 25,000 billion kroner at the end of the year. We also published all our holdings as we normally do yesterday. So that's the holdings as of year end. You can go in and find everything that we hold. We also this morning published the stress test that I talked about in this press conference.
Yeah. And then we have a few events coming up. We have a risk summit coming up on the 18th of March where we basically showcase our really great risk department, all the types of risk assessments we do, how we use AI into all these work. And I think it's going to be very, very interesting. We've also here invited the main kind of risk departments of the various Nordic financial institutions. We will also have a seminar on how we use AI to drive down costs in the firm and in our trading operations. And I think this will be also interesting. We are still to set a date for this but I think that will be interesting. And then we have our investment conference coming up in April. You know, when I started in this business, it was all about numbers and the next quarterly reports. And as I've gained some age, I just realized it's all about people and the corporate culture. And so we have got together what I think is a really, really strong team of some of the best CEOs in the world. Okay, that's where we are.
Nicolai, we will now move to questions. Please use your microphone when you ask a question because we have a lot of people following us on stream. So, just raise your hand and I will give you the word.
Okay, start with K Bloomberg.
Good morning. We have, how have recent geopolitical tensions changed your thinking about regional diversification? Particularly when it comes to exposure to the US.
