UAIB Review of the Institutional Investor Asset Management & Pension Fund Administration Industries in Ukraine in Q3 2021. General Results

During July-September 2021, the Ukrainian stock markethad mostly downward dynamics, which took place against the background of the formation of a new wave of corona crisis in the world. This led to lower  rates of return of certain CII sectors, including equity funds. However, most CII sectors performed better than in the previous quarter and seven out of eight had positive results for the period since the beginning of the year and for the last 12 months. Among NPFs, two thirds of funds showed positive returns for the 3rd quarter.

In general, the industries of asset management of institutional investors and administration of pension funds in the 3rd quarter of 2021 continued to grow. By sector, open-ended CII returned to an upward trend, including due to the recovery of capital inflows. Close-end funds with private placement, including venture CII, have been steadily increasing by number and total assets. NPF assets also grew steadily in the 3rd quarter of 2021.

Number of market participants

Asset Management Companies (AMCs)

In the 3rd quarter of 2021, the total number of asset management companies increased by six to 313. During July-September, 9 new AMCs were established and three ceased operations. Of all AMCs, 286 managed between one and 66 funds, and more than 98% of such companies managed at least one venture CII.

Administrators of private pension funds (ANPFs)

The number of ANPFs in the 3rd quarter of 2021 did not change: they were still 19. Among them, as before, there were 6 companies that carried out exclusively the activities of NPF administration, the rest combined it with asset management.

Collective investment institutions (CIIs)

In the 3rd quarter of 2021, 54 new CII were registered. The total number of CII that reached the standard for the minimum amount of assets (formed)grew for the 16th consecutive quarter and amounted to 1,624 at the end of September (+4.1% for the quarter).

Non-state pension funds (NPFs)

The number of NPFs under management as at  September 30, 2021 was 55 (excluding the NBU corporate fund), including 46 open-ended, 3 corporate and 6 professional ones. In total, 33 AMCs managed the assets of the NPF.

In September, 57 NPFs were administered by 18 ANPF members: 47 open, 4 corporate and 6 professional ones.

Insurance companies (ICs)

The number of insurance companies (ICs) that transferred their assets to AMC management and the number of AMCs that provided such services did not change in the 3rd quarter of 2021: as at September 30, 2021, one such company continued to manage the assets of two insurance companies.

Assets under management and NAV

All institutional investors

Total assets under AMC management in the 3rd quarter continued to accelerate growth - to 6.4% for three months - and as at September 30, 2021 reached UAH 507,806 M. From the beginning of the year these assets grew by 19.6%, and for the last 12 months at the end of September - by 26.9%.

Collective investment institutions (CIIs)

The total assets of all CII under management, including those that have not yet reached the standard, also grew by 6.4% in the 3rd quarter and by 27% in the last year. As at September 30, 2021, they amounted to UAH 505,498 M.

As at the end of September 2021, the assets of operating CII, which reached the standard of the minimum amount of assets (formed), reached UAH 496,066 M. In the 3rd quarter they grew by 6.0% (as in the second quarter), since the beginning of 2021 - by 19.8%, and for the last 12 months - by 25.8%.

The value of net assets of all formed CII as at the end of September 2021 reached UAH 373,066 M. In July-September, it accelerated the quarterly growth rate, but slowed down the annual growth rate: +5.0% for three months and +20.5% for the last year. For 9 months of 2021, the NAV of the formed CII added 15.8%.

The total net movement of capital in open-ended CII in the 3rd quarter of 2021 returned to positive: +UAH 5.8 M. Net inflows into the sector from the beginning of the year remained positive, as the annual inflow did, which slowed down to UAH 60.7 M at the end of September.

Non-state pension funds (NPFs)

In July-September 2021, NPF assets managed by AMC accelerated quarterly growth to 3.3%, but slowed to 11.6% year on year. In the first 9 months of the year, they added 8.3% and as at  September 30, 2021, they reached UAH 2,120 M.

At the end of September, NPFs in the administration of UAIB members had UAH 2,122 M in assets, which is 2.7% more than in June.

Insurance companies (ICs)

The assets of the IC under the management of AMC in the 3rd quarter of 2021 continued to grow - at an accelerated pace: +6.4%. From the beginning of the year they added 9.9%, and for the last 12 months - 15.8% and as at the end of September amounted to almost UAH 188 M.