Mutual fund AUMs hit P62 billion in April

MANILA, Philippines – The mutual fund industry has reported that its assets under management (AUM) amounted to P61.8 billion end April 2009, or up slightly by three percent from the P60 billion end 2008.

The Investment Company Association of the Philippines (ICAP), the trade organization of the country’s mutual fund industry, said that they are looking at a double-digit growth rate this year.

The first three months of 2009 is all driven by market value, and sales is picking up.

However, ICAP president Karen Roa does not see the mutual fund’s performance reaching the boom 2007 levels of P86 billion.

“For the Philam Asset Management Inc. (PAMI) alone, we were hitting P1-billion sales a month,” Roa, who is also the PAMI chief executive, said.

She, however, stressed that the backdrop of the record levels of 2007 was an active 20-percent growth in 2006.

“If there are not major disruptions, we could spring forward this year as strong as 2006,” she added.

Roa said that the country’s fundamentals remain positive with domestic investments picking up. The Philippine Stock Exchange index (PSEi) alone is already up roughly 30 percent.

The country’s gross domestic product (GDP) grew by a mere 0.4 percent in the first three months of 2009, but the rest of the region was experiencing a contraction in their economies.

But the remittance business continued to register positive gains, which in turn was feeding consumption, savings and more investments.

The Trust Officers Association of the Philippines (TOAP) was likewise looking at a double digits growth, or roughly the same rate of 15.44 percent realized in the first three months of 2009.

TOAP is the umbrella organization of 44 bank and non-bank financial institutions with trust licenses in the country and more than 250 individual trust practitioners.

The first quarter volume of AUMs, held by 37 bank-based trust licensees, amounted to P1.545 trillion or 15.44 percent higher from the P1.338 trillion in end December 2008.

Roa said that large individual and institutional investors have been forced to migrate back to the country’s capital and investment markets. These can be seen from the steady growth in various deposit and trust products in the banking system, strong securities and secondary markets, and mutual funds.

The mutual fund industry manages bond or fixed income funds, equity or stock funds, balanced funds, and money market funds.

Net assets of the bond or fixed income funds (both the peso and foreign currency denominated funds) amounted to P39.4 billion.

Peso-denominated bond funds amounted to P29.2 billion while the foreign currency bond funds (mainly US dollar and the euro) amounted to P10.2 billion.

Balanced funds, or a mix of bond and equity funds, amounted to P13 billion.

Equity funds meanwhile reached P8.7 billion while the money market funds amounted to P610 million.

The number of accounts stood at 88,741 as of end April this year. It reached an impressive 148,388 end 2007.

There are 13 fund or asset managers take care of the different mutual funds.

They are BPI Asset Management Group (BPI AMG), Philam Asset Management Inc. (PAMI), Sunlife Asset Management Co. (SLAMC), Philequity Asset Management, First Metro Asset Management, Grepalife Asset Management, MFMCP, Prudential Asset Management, UCPB Trust, Ekklesia Asset Management, DWS Deutsche, MAA Asset Management, and First Galleon Asset Management.

The three biggest asset groups are BPI AMG, which controls over 45-percent market share, followed by PAMI (22.12 percent) and SLAMC (20.38 percent).

There are 41 mutual funds managed by the 13 asset managers.

PAMI and SLAMC manages seven funds each while BPI AMG handles five. Philequity looks over four mutual funds while First Metro Asset Management takes care of three funds.

The two newest members of the mutual fund industry are DWS Deutsche and UCPB Trust.

The single biggest fund is the ALFM Peso Bond Fund managed by BPI AMG amounting to P22 billion in end April 2009.

The Sun Life Prosperity Balanced Fund came in second largest amounting to P6.5 billion. It is overseen by SLAMC.

The ALFM Dollar Bond Fund expanded to P5.2 billion followed by the Philam Bond Fund with AUMs worth P3.1 billion.

In terms of managing the largest number of accounts, PAMI loomed it over the field with 34,418 followed by SLAMC with nearly 22,000 accounts.

A sweeping glance at the net asset values (NAV) of the various mutual funds show that practically all reflected positive gains versus the previous year.