2017 highlights of the Ukrainian asset & fund management industry

Ukrainian asset management industry key facts in 2017:

• Asset management companies (AMCs) in Ukraine had UAH 263.8 billion of Collective Investment Institutions’ (investment funds) assets and the total of UAH 265.2 billion of AuM (including private pension funds and insurance companies’ assets) as at end 2017. This represents a 13.5% growthfor theyear in UAH terms and a 3.7% decline in EUR terms (after a 2.0% decline in UAH terms in 2016).

• Total AuM of ‘established’ (formed) CII reached UAH 263.5 billion as at end 2017.

• Number of AMCs edged up from 295 to 296, and the number of formed CII increased for the first time since 2013 and reached 1160 funds.

• The number of AMCs dealing with acting open-ended funds remained 10, while thenumber of such fundshas contracted from 18 to 17over the year.

• Of the total AuM, 97% were in the “venture” CII (privately placed closed-end “non-diversified” funds with the lowest restrictions on their activity), where mainly institutional/corporate investors remained the biggest category holding over 90% share in their NAV (including 68% belonging to domestic corporates). Natural persons resident in Ukraine made up 13% of the total number of investors in these funds, holding more than 9% of their total NAV.

• Open-ended funds had a major milestone in 2017, registering first positive net sales in a decade (UAH 2.2 M, after the net outflow of UAH 1.7 M in 2016). Meanwhile, their total NAV rose for the second year in a row in 2017, to UAH 75 M, havinggrown by 30% over the year (after 5.1% in 2016).

• 76% in the open-ended funds’ NAV belonged to domestic retail investors, who comprised more than 98% of all the investors in these funds.

• There were 6 foreign investors (institutional/corporate and individual) in Ukrainian open-ended funds and 455 in all the CII who comprised, respectively, 0.4% and 0.2% of all their investors, holding 13.3% and 22.5% of their total NAV respectively. This was down from 16.4% in open-ended funds (due to stronger growth of the domestic investors’ holdings) and up from 21.5% in all CII in total in 2016. Of all the non-resident investors in all CII, 92.5% were institutional/corporate ones.

• CII performance grew further in 2017, andamong the various categories of CIIthe highest was shown by open-ended funds and “diversified” equity funds with public offer (of different fund types, including open-ended ones). Both fund categories increased their mean rate of return this year by a factor of 2: open-ended CII had ROR of 27.3% in 2017, while equity funds had 30.1%.

• Assets of Non-state Pension Funds (NPFs)under management of AMCs in Ukraine grew to UAH 1,194 M as at end 2017 (+15.2% for the year, after +11.7% in 2016) – excluding the National Bank’s corporate pension fund. The latter is managed by the NBU itself and had almost 52% of the total NPFs’ AuM in 2017. There were 58 NPFs under management of 34 AMCs as at end 2017 (down from 39 and 62 in 2016 respectively).

• Insurance companies’ AuM showed even stronger growth which doubled in 2017 – by 127.5% (after 65.7% in 2016), while still remaining relatively small at UAH 123.6 M. Two AMCs were managing assets of 6 ICs as at end 2017 (down from 3 and 7 in 2016 respectively).

• See more figures at the UAIB website:

http://www.uaib.com.ua/eng/analituaib.html

Full UAIB Annual Analytical Report Q4 2017 & Full Year 2017 is available now in Ukrainian.

English version of the Report to follow soon.

For enquiries, please contact Anastasiia Gavryliuk, Director of International Relations - Senior Analyst at gavrylyuk@uaib.com.ua.