Figures UCITs sector 1st quarter 2019
28 August 2019 - 8 min Reading time
The Belgian fund sector experienced a 1.4% increase during the first quarter of 2019, primarily due to capital gains recorded from the underlying assets. At the end of March 2019, the net assets of publicly distributed funds in Belgium amounted to 190.0 billion EUR.
The net assets of funds primarily investing in fixed-income securities declined by 12.8% during the first quarter of 2019, partly due to a portfolio technical intervention (removal of capital protection). In contrast, the net assets of funds mainly investing in non-fixed-income securities, such as balanced funds and equity funds, increased by 6.1% during this period.
Within the category of mixed funds, pension savings funds experienced a strong recovery during the period from January to March 2019. With an increase of 1.5 billion EUR, these funds reached a new "all-time high" in net assets, totaling 19.7 billion EUR.
Monetary funds saw the largest absolute decrease in their net assets during the first quarter of 2019, mainly due to significant net redemptions related to portfolio technical interventions.
Mixed funds witnessed the most significant growth during this period.
Belgian Fund Market
The Belgian fund market is defined as the "publicly distributed net assets of funds under Belgian and foreign law" in Belgium. BEAMA reports on all share classes of public funds that are allowed to be marketed in Belgium.
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BEAMA's research shows that the net assets of publicly marketed funds in Belgium increased by 2.7 billion EUR, or 1.4%, during the first quarter of 2019. As a result, publicly marketed funds in Belgium represented 190.0 billion EUR at the end of March 2019.
The rise in the Belgian fund market during the period from January to March 2019 can be fully attributed to positive market developments in the early months of 2019, which resulted in capital gains recorded from the underlying assets of most funds. This partially compensates for the temporary decline observed at the end of 2018.
Pension savings funds recovered strongly during the first three months of 2019 from their decline in the last quarter of 2018. As of the end of March 2019, pension savings funds had a total net asset value of 19.7 billion EUR, setting a new "all-time high."
Evolution of the Belgian Fund Market Over the Last Decade
Percentage of Retail Share Classes in the Belgian Fund Market
BEAMA definieert retail aandelenklassen als zijnde aandelenklassen die mogen aangeboden worden aan particulieren, waarbij de minimale (initiële) inleg niet meer bedraagt dan 100.000 EUR en waarbij er geen bijkomende voorwaarden worden opgelegd door de beheerder van het fonds. Tijdens de eerste jaarhelft van 2016 werden zodoende technische verfijningen in de statistieken van BEAMA doorgevoerd.
Funds Primarily Investing in Fixed-Income Securities
Within the group of funds primarily investing in fixed-income securities, the assets of publicly marketed bond funds in Belgium decreased by 2.3 billion EUR, or 6.8%, during the first quarter of 2019, bringing their total to 31.5 billion EUR at the end of March 2019. This decline was primarily due to losses incurred on the underlying assets.
The net assets of monetary or money market funds saw a decrease of 3.7 billion EUR, or 28.3%, during the period from January to March 2019.
This decline resulted from a technical intervention in the portfolios of mixed umbrella funds. Given the positive market movements during the first quarter of 2019, asset managers of umbrella funds exchanged their underlying stable monetary funds for equity funds to benefit from the stock market recovery. In short, given the favorable stock market conditions, the capital protection of mixed umbrella funds is currently not relevant.
In total, the net assets of funds primarily investing in fixed-income assets decreased by 12.8% during the first quarter of 2019, resulting in a publicly marketed net asset value of 40.8 billion EUR at the end of March 2019.
Funds Primarily Investing in Non-Fixed-Income Securities
Within the group of funds primarily investing in non-fixed-income securities (such as equity funds), with the exception of capital protection funds, only rising trends were observed during the first quarter of 2019, primarily due to capital gains recorded from the underlying assets of these funds.
The assets in Belgium of equity funds increased by 4.1 billion EUR, or 8.8%, during the period from January to March 2019. This increase is largely attributable to net subscriptions (mainly due to portfolio technical interventions). As of the end of March 2019, the assets of equity funds amounted to 50.2 billion EUR.
Detailed Evolution of Marketed Assets Over the Last Decade
The category of mixed funds (including pension savings funds) saw an increase of 4.5 billion EUR, or 5.1%, during the first quarter of 2019. This was primarily due to capital gains recorded from the underlying assets, supplemented to a lesser extent by net subscriptions. Consequently, the publicly marketed assets of mixed funds amounted to 93.7 billion EUR as of the end of March 2019.
These funds have seen increasing success in recent years and have been the largest asset class since 2015. Due to their active asset allocation, mixed funds are well-suited for implementing risk diversification policies in the context of MiFID II, making them excellent for aligning the product with the risk profile of clients.
Within the category of mixed funds, pension savings funds experienced a strong increase during the first quarter of 2019, amounting to 1.5 billion EUR, or 8.2%. This fully reverses the temporary decline observed in the last quarter of 2018. As of the end of March 2019, pension savings funds represented a total net asset value of 19.7 billion EUR.
During the first quarter of 2019, pension savings funds recorded net subscriptions amounting to 163 million EUR.
Capital protection funds experienced a decline during the first quarter of 2019, representing assets totaling 4.7 billion EUR as of the end of March 2019. This movement can be attributed primarily to losses incurred on the underlying assets.
Overall, the net assets of funds primarily investing in non-fixed-income securities increased by 6.1% during the first quarter of 2019, reaching a publicly marketed value of 149.2 billion EUR as of the end of March 2019.
"The Belgian fund market partially recovered during the first three months of 2019 from the difficult end of 2018, thanks to capital gains."
Funds Under Belgian Law
Publicly distributed funds under Belgian law
The calculation of the average annual return for pension savings funds as of March 31, 2019, yields the following results:
Publicly distributed funds under Belgian law had a total managed net asset value of 155.5 billion EUR at the end of March 2019. At that same moment, pension savings funds represented 19.7 billion EUR of this, which is one-eighth of the publicly distributed funds under Belgian law.
The calculation of the average annual return for pension savings funds as of March 31, 2019, yields the following results:
- 1-year return: +1.2%
- 3-year return: +4.2%
- 10-year return: +6.3%
- 25-year return: +6.3%
BEAMA has developed a dashboard for pension savings funds, which is attached to this press release as an annex. Thanks to this dashboard, key figures related to third-pillar pension savings funds and their evolution are visually presented in a concise manner on a quarterly basis.
Non-Publicly Distributed Institutional Funds Under Belgian Law
Since the implementing Royal Decrees were published in the Belgian Official Gazette on December 18, 2007, investment vehicles tailored to institutional investors have been able to be developed in the form of "Institutional ICB with a variable number of units." These institutional funds are non-public funds that must be registered with the Federal Public Service Finance (FOD Financiën).
Additionally, there are other non-public funds that are privately placed
These institutional funds should not be confused with public funds with non-retail share classes, which are registered with the Financial Services and Markets Authority (FSMA).
As of the end of March 2019, the 141 institutional compartments under Belgian law represented 15.9 billion EUR in net assets. These funds appeal to many institutional investors because they provide depth to institutional markets in terms of financial assets and pension formation.
