Institutional investors in Germany have withdrawn €15.7bn from mandates in the first half of this year, according to figures published today by the country’s fund industry association BVI.
Investment funds received €28.3bn net in new money in the first half of 2024, according to the figures.
Among institutional investors, pension schemes remain the largest investors in open-ended Spezialfonds, with €753bn, up by 45% from mid-2019, from assets totalling €521bn, primarily the results of high inflows of funds, BVI stated.
Insurers follow in second place with assets totalling €524bn allocated to open-ended Spezialfonds, it added.
Open-ended Spezialfonds saw a total net inflow of assets decreasing to €15.14bn in this year, from €16.87bn last year.
The largest share of assets flowing to open-ended Spezialfonds is invested in real estate funds, with €2.42bn, down from €3.55bn last year, and the remaining €276.7m is allocated to fund of funds (FoFs), up from -€115.3m last year, the figures showed.
Net inflows to closed-ended Spezialfonds went up to €1.45bn so far this year, from €1.22bn last year. Assets held in Spezialfonds, a vehicle opened only to institutional investors in Germany, have decreased over the last five years, hit recently by price losses as a consequence of higher interest, BVI explained.
For regulatory reasons, insurance companies hold a high share of bonds in Spezialfonds, it added.
Lower net inflows of pension schemes in Spezialfionds are primarily the result of direct investments in bonds becoming more attractive since mid-2022, Kommalpha’s managing director Clemens Schuerhoff told IPE commenting on a “remarkably poor” net inflows of assets of pension funds and insurance companies in Q1.
Assets channelled by non-profit organisations, for example churches, credit institutions, manufacturing and service companies (ex financial services), to Spezialfonds, have instead increased since mid-2019, BVI added.
The German fund industry managed a total €4.31trn on behalf of investors at the end of June this year, up from €4.14trn at the end of 2023. Assets have almost doubled in the last 10 years, increasing by an average of just under 7% per year, and reaching in the first half of this year a record level seen at the end of 2021, according to the association.
The largest share of assets under management amounting to €2.13bn is invested in open-ended Spezialfonds, up from €2.01bn in the same period last year. Closed-ended Spezialfonds held assets amounting to €55.54bn at the end of June this year, including €15.64bn in closed-ended real estate Spezialfonds, up from €48.98bn in the same period last year, according to BVI figures.
Fund companies manage €1.49bn in open-ended retail funds, with €630bn locked in discretionary mandates and €58bn in closed-ended funds.
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