* Investment committee will approve deals over $250 mln
* Central bank board will approve deals over $1 bln
By Stine Jacobsen
OSLO, Oct 20 (Reuters) - The board of Norway's central bank is introducing an extra layer of supervision for the country's sovereign wealth fund, which will need to seek approval for all property deals over $250 million, the bank said on Tuesday.
For the first time, the $860 billion wealth fund, the world's largest, will need approval for some of its most valuable property deals. Property represents 2.7 percent of its total value, which it wants to increase to five percent.
The fund, which invests Norway's revenues from oil and gas in stocks, bonds and property, will now need to approval from a new investment committee for deals over $250 million. Deals worth more than $1 billion will need the approval of the board of the central bank. Until now, the fund's management, led by Chief Executive Yngve Slyngstad, decided on its own.
"The purpose of the changes is to ensure a collective anchoring for the biggest real estate investments," Hilde Singsaas, head of press at the Norwegian central bank, told Reuters.
"Unlike listed shares, which are relatively liquid, property investments are less reversible," she said in replies to emailed questions. "This implies a different decision-making structure."
The change comes a year aftger the management of the fund came under criticism for taking a $1.6 billion stake in motor racing's Formula One in 2012. Formula One called off an IPO after the investment, technically putting the fund in violation of a rule that allows it to buy stakes in unlisted companies only if they plan to float.
The fund's head later acknowledged mistakes were made in connection with the investment, amid calls for tighter supervision of the fund.
Separately, the fund advertised in a Norwegian newspaper on Tuesday for the newly created position of chief executive officer for Norges Bank Real Estate Management, the division that will manage all the fund's real estate investments, who will report to Slyngstad.
$1 = 8.1212 Norwegian crowns Writing by Stine Jacobsen and Gwladys Fouche, editing by Larry King