UAIB Analytical Review of the Asset Management Market in Ukraine in Q1 2020. General Results

The Ukrainian stock market began 2020, like the world's leading markets, with a sideways trend, which was replaced by a sharp rise in volatility and a subsequent sharp decline in March with the introduction of restrictive measures in Ukraine and around the world caused by the COVID-19 pandemic. However, the national economy declined less in January-March than the GDP of leading countries and of China, where the pandemic spread and where restrictive measures were introduced earlier, and key indicators of domestic blue chips ended Q1 among world leaders, with the smallest decline or a slight growth.

The asset management industry in Ukraine during this period continued to grow both in terms of quantity of participants and of value of assets under management, while capital inflows to open-ended CII resumed.

Number of market participants

Asset Management Company (AMC)

In Q1 2020, according to UAIB, the number of asset management companies increased by 4 to 297. In total, 6 new AMCs were created during this period.

At the end of March, 279 AMCs managed between 1 and 53 funds, and almost 99% of all such AMCs managed at least one venture CII.

Collective Investment Institutes (CII)

In January-March 2020, 40 new CII were registered. Considering the closed funds, as of March 31, 2020, the total number of registered CII increased by 1926, by 1.9% since the beginning of the year.

The number of CII that reached the minimum assets ratio (‘established’ funds) grew for the tenth consecutive quarter, to 1357 (+ 2.3% for the quarter).

Non-State Pension Funds (NPFs)

The number of NPFs under management as of March 31, 2020 was 60 (excluding the NBU’s corporate pension fund), including 48 open funds, 6 corporate and 6 professional ones. A total of 34 AMCs managed NPF assets.

Insurance Companies (IC)

The number of insurance companies that transferred their assets to AMC management has not changed since the beginning of 2020, as well as the number of AMCs that provided this service: as of March 31, 2020, one such company managed the assets of two insurance companies.

Assets in management and NAV

All Institutional Investors

Total total assets under AMC management grew by 3.3% Q1 2020 (by 9.0% over the last 12 months) and reached UAH 366,825 million at the end of March.

Collective Investment Institutes (CII)

In Q1 2020, the total assets of all CII under management, including those that have not yet reached the standard, also increased by 3.3% and by 9.0% over the year, to UAH 364,995 million.

As of March 31, 2020, the assets of existing CII, which reached the standard of the minimum volume of assets (‘established’ CII), amounted to UAH 356,884 million. In Q1 2020, they grew by 5.2%, and in the last year - by 12.4%. As before, the lion's share of the growth of CII assets was provided by venture funds, the number of reports for the quarter of which increased by 6.3%.

The value of net assets of the established CIIs as of March 31, 2020 reached UAH 274,322 million. In Q1, it grew by 5.0% (see above footnote on total assets), and for the last 12 months by 11.2%.

Non-State Pension Funds (NPFs)

NPF assets managed by AMC in Q1 2020 slightly slowed down to 3.1% (up to 16.1% over the year). As of March 31, 2020, they reached UAH 1,653 million.

Insurance Companies (IC)

The assets of the IC under the management of AMC increased rapidly at the end of March (+ 35.7% since the beginning of 2020, + 46.4% year on year). As of March 31, 2020, these assets amounted to UAH 131 million.