BH Global Limited Announces 2012 Financial Results (Excerpt)

Hamilton, Bermuda – 19 March, 2013 – BH GLOBAL LIMITED (the “Company”) announces the financial results for the year ended 31 December, 2012. In a statement to shareholders, Sir Michael Bunbury, Chairman, stated:

“Dear Shareholder,

I was appointed to the Board of BH Global Limited (the “Company”) and became Chairman on 1 January 2013. My Statement relates both to the twelve months of the Company’s year to 31 December 2012 and to subsequent developments. Clearly, though, as I was not a director during 2012, I can only comment on the overall outcome of that year. However, the Manager’s Report contains detailed information on the Company’s investment activities and performance during 2012.

It is a privilege to have been asked to succeed Andrew Turnbull as Chairman. Andrew served as your Chairman since the launch of the Company in 2008. Last year he was asked by UK Government to serve on the Parliamentary Commission on Banking Standards. The time commitment for that appointment is such that, when taking into account his other directorships of listed companies, he felt he did not have sufficient time to concentrate fully on the Company’s business and consequently informed his colleagues that they should seek a new Chairman. On behalf of all shareholders I pay tribute to Andrew for his wisdom and experience in leading the Company through one of the most turbulent periods ever in financial markets.

By way of introduction I have been involved in the investment world for over 40 years. I am a director of a number of other Investment Companies as disclosed in this Report. In May 2012 I retired from the Board of Foreign & Colonial Investment Trust after 14 years’ service and thus was able to respond positively when I was approached by BH Global Limited.

Although the Sterling share class is the largest of the Company’s three share classes, the Board has determined that it will express the Company’s performance in US Dollars, being the principal reference currency for the Underlying Funds in which the Company invests. The currency hedging that occurs at the level of the Underlying Funds is designed to ensure that the performance of both the Sterling and Euro classes follows closely that of the US Dollar share class. For the fifth successive year to 31 December the Company has reported an increase in Net Asset Value (“NAV”) per share. For 2012 the NAV of the US Dollar shares increased by 4.44%. Further details regarding the 

performance are given in the Manager’s Report. Whilst the increase in NAV was modest in a year when some other investment assets powered ahead as confidence grew, the Company’s focus is to provide a relatively uncorrelated risk diversifier and in particular to seek to avoid any sustained reductions in NAV per share.

Although I was aware of Brevan Howard, it was not until I was asked to become Chairman of BH Global Limited that I undertook a personal diligence process. Inter-alia that involved meetings with Brevan Howard personnel and also advisers to the Company. Those meetings culminated in meetings with Alan Howard, the principal founder of Brevan Howard, and Aron Landy, Chief Risk Officer. In the light of so many control failures in the proprietary trading operations of various banks I was particularly interested in being briefed on risk controls, both operational and in terms of minimising risk of loss to shareholders.

Managing a series of hedge funds as Brevan Howard does is an immensely complex business. From my meetings and from written material supplied to me, I have gained considerable confidence that Brevan Howard’s systems and controls appear to be of very high quality and have been put to real tests during the 10 years since Brevan Howard was founded. Clearly, other investors have come to the same conclusion as total funds managed by Brevan Howard have grown from approximately US$34 billion to in excess of US$39 billion in the 12 months to 31 December 2012.

BH Global Limited provides investors of modest means access to Brevan Howard’s global suite of hedge funds. Such access is otherwise only available to substantial, mainly institutional, investors who can make a minimum commitment of millions of US Dollars and that is subject to the underlying fund being open to new investors. However, growth in NAV per share is only of value to shareholders if it feeds through to Total Return on the shares themselves. With that in mind, the Board of the Company resolved to implement two actions to enhance shareholder returns.

The first action has been to offer shareholders the opportunity to redeem part of their shareholding at a discount of 3% to the NAV per share at 31 December 2012. As already advised, the Board have committed sums of approximately US$7.2 million, £22.2 million and €1.2 million to this programme, being approximately equivalent to 100% of the increase in NAV per share in each share class in 2012. The details of this programme were set out in the Circular dated 8 February and the result announced on 28 February. Unsurprisingly in the light of the discount to NAV at which the Company’s shares had been trading, the number of shares tendered exceeded the sum that the Company had committed to the redemption programme. Thus shareholders who tendered shares in excess of their Redemption Entitlement have received their Entitlement plus a modest excess, the exact percentage being dependent upon the particular share class tendered.

Secondly, during the second half of 2012 the Board monitored the widening discount to NAV at which shares were trading. In accordance with the authority granted by shareholders, the Company has recently recommenced its programme to buy-back shares. This programme will be funded by redemptions from the various Underlying Funds and where appropriate the Company’s credit lines which provide short-term 

funding in advance of the receipt of redemption proceeds. The Board intends to make use of buy-backs sparingly and opportunistically as it does not believe that buy-backs alone can materially reduce discounts in an on-going company. Investor sentiment and especially underlying investment performance are both critical to the permanent reduction of discount in closed-ended companies.

2013 and beyond

The year has started satisfactorily with NAV per share of the US Dollar shares growing by 1.33% between 1 January and 31 January and preliminary estimates indicate that positive performance has continued in February. Most markets have been relatively calm with sentiment positive since mid–2012. However, there remain significant potential threats to markets and to economies, particularly in developed Western countries where growth is being sluggish and the ability of many governments to influence that growth severely constrained both by their fiscal situation and by political constraints. The United States will continue to be the largest economy in the world for a number of years. However, it is depressing that its politicians appear incapable of facing up to the deteriorating outlook for the US’s financial situation.

In Europe growth continues to be elusive, owing impart to the constraints imposed on some countries by their membership of the Eurozone. Investors should not underestimate the political determination to ensure that the euro survives. However, for there to be confidence in it becoming a sound currency difficult political decisions lie ahead. Nevertheless, the mechanism by which those decisions can be taken in mature democracies is, in many instances, elusive unless governments are pressed by markets. Politicians are frequently deterred from taking decisive action by fear of the reaction of their electorates as demonstrated by the statement by Jean-Claude Juncker, former Prime Minister of Luxembourg and until recently President of the Eurogroup. In 2007 he was reported as saying “We all know what to do, but we don’t know how to get re-elected once we have done it”. It seems to me that little has changed.

In the light of the problems in many mature economies I expect world growth to continue to be driven in emerging markets, particularly China and India. Meanwhile, difficulties elsewhere will result in continuing volatility. I am confident that Brevan Howard will be in a position to exploit these opportunities for the benefit of the shareholders of BH Global Limited.

I look forward to meeting shareholders and would welcome their contact with me at any time through the Company’s Administrator, Northern Trust International Fund Administration Services (Guernsey) Limited, at Guernsey_Client_Services@ntrs.com.

Yours sincerely,

Sir Michael Bunbury

Chairman

For the latest information and the Annual Report and Audited Financial Statements of BH Global Limited and the Annual Audited Financial Statements of Brevan Howard Master Fund Limited visit BH Macro’s website www.bhglobal.com