Figures UCITs sector 3rd quarter 2019
21 January 2020 - 7 min Reading time
The Belgian fund sector saw a growth of 1.6% during the third quarter of 2019, driven by net subscriptions combined with capital gains recorded by underlying assets. As of the end of September 2019, the net assets of publicly distributed funds in Belgium amounted to EUR 201.9 billion.
The net assets of funds mainly investing in fixed-income securities experienced a decline of 2.7% during the third quarter of 2019. In contrast, the net assets of funds primarily investing in non-fixed-income securities, such as balanced funds and equity funds, increased by 2.7% during this period.
Within the category of mixed funds, pension savings funds continued to grow during the period from July to September 2019. With an increase of EUR 0.3 billion, they reached an all-time high of net assets totaling EUR 20.4 billion.
Monetary funds experienced the largest absolute decrease in their net assets during the third quarter of 2019, mainly due to significant net repayments linked to portfolio-related interventions.
Mixed funds saw the largest absolute increase during this period, driven by a combination of capital gains on underlying assets and net subscriptions. Equity funds, with a growth rate of 3.5%, experienced the largest relative increase.
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 can be marketed in Belgium.
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BEAMA's research indicates that the net assets of publicly marketed funds in Belgium increased by EUR 3.1 billion or 1.6% during the third quarter of 2019. As of the end of September 2019, publicly marketed funds in Belgium represented EUR 201.9 billion, surpassing the previous "all-time high" of EUR 200.0 billion exactly one year ago.
The increase in the Belgian fund market during the period from July to September 2019 is largely explained by net subscriptions, accounting for two-thirds of the growth, with the remaining portion attributed to positive market developments during this period. The capital gains recorded during the first nine months of 2019 nearly fully compensated for the significant decline observed in the last quarter of 2018.
Evolution of the Belgian Fund Market Over the Last Decade
Percentage of Retail Share Classes on 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 Mainly 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 declined by EUR 0.1 billion or 0.2% during the third quarter of 2019, resulting in total assets of EUR 34.4 billion by the end of September 2019. Behind this almost unchanged situation were opposing movements, as the capital losses on underlying assets were nearly offset by net subscriptions.
The net assets of money market funds decreased by EUR 1.1 billion or 13.3% during the period from July to September 2019. This decline was a result of technical interventions in the portfolios of mixed umbrella funds. Given the positive market movements in recent months, asset managers of umbrella funds gradually replaced their underlying stable monetary funds with equity funds to benefit from the market recovery. In short, given the favorable stock market conditions, the downside protection of mixed umbrella funds is currently not applicable.
As a whole, the net assets of funds primarily investing in fixed-income securities decreased by 2.7% during the third quarter of 2019, resulting in total marketed net assets of EUR 41.5 billion by the end of September 2019.
Funds Mainly Investing in Non-Fixed-Income Securities
Within the group of funds primarily investing in non-fixed-income securities, except for capital protection funds, only upward trends were recorded during the third quarter of 2019. Two-thirds of these increases were attributed to net subscriptions, while the remainder came from capital gains on underlying assets.
Assets in Belgium of equity funds increased by EUR 1.9 billion or 3.5% during the period from July to September 2019. This increase was due to net subscriptions. As of the end of September 2019, the assets of equity funds amounted to EUR 56.4 billion.
Detailed Evolution of Marketed Assets Over the Last Decade
The category of mixed funds (including pension savings funds) recorded an increase of EUR 2.4 billion or 2.5% during the third quarter of 2019. This growth was attributed to net subscriptions and capital gains recorded by underlying assets. Consequently, the marketed assets of mixed funds reached EUR 98.7 billion by the end of September 2019.
Mixed 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 highly suitable for implementing risk diversification policies in accordance with MiFID II. They are excellent for aligning the product with the client's risk profile.
Within the category of mixed funds, pension savings funds saw an increase of 0.3 billion EUR or 1.3% during the third quarter of 2019, reaching net assets totaling EUR 20.4 billion by the end of September 2019. It's worth noting that during September 2019, a fifth and final accelerated advance levy (the 5 x 1% rule) was withheld. Without this accelerated levy, net subscriptions would have been significantly higher.
Funds with capital protection experienced a slight decline during the third quarter of 2019 and represented assets of EUR 4.6 billion by the end of September 2019. This movement was primarily due to capital losses recorded by underlying assets.
In total, the net assets of funds primarily investing in non-fixed-income securities increased by 2.7% during the third quarter of 2019, reaching a marketed assets value of EUR 160.3 billion by the end of September 2019.
Funds Under Belgian Law
Publicly Distributed Funds Under Belgian Law
Public funds under Belgian law had a total managed net asset value of EUR 158.5 billion by the end of September 2019. At that moment, pension savings funds represented EUR 20.4 billion of this, or 1/8th of the public funds under Belgian law.
The calculation of the average annual return for pension savings funds as of September 30, 2019, yields the following results:
- 1-year return: +3.1%
- 3-year return: +3.6%
- 10-year return: +5.4%
- 25-year return: +6.4%
BEAMA has developed a dashboard for pension savings funds, attached to this press release. Thanks to this dashboard, key figures regarding 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 can 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 (FPS) Finance.
These institutional funds should not be confused with publicly distributed funds with non-retail share classes, which are registered with the Financial Services and Markets Authority (FSMA).
As of the end of September 2019, the 141 institutional compartments under Belgian law represented EUR 16.7 billion in net assets. These funds attract many institutional investors, contributing to the depth of institutional markets in terms of financial assets and pension formation.
