PAMI closes in on record P48-B AUMs

MANILA, Philippines - The Philam Asset Management Inc. is looking to hit another record level of P48 billion in assets under management as the savings and earnings appetite of the public increases with the country’s strong economic fundamentals.

PAMI is a fund management firm allied with the Philippine American Life and General Insurance Co. (Philam Life), one of the country’s leading financial and insurance institutions.

AUMs at the end of October this year already reached a record P46.7 billion, 17 percent better than the P39.9 billion in Oct 2013 and 22.2 percent higher compared to the end Jan. 2014 of P38.2 billion.

The AUM is the value of all the mutual funds overseen by the fund manager.

PAMI manages nine peso- and US dollar-denominated mutual funds. The funds are invested in equity, bond or fixed income, balanced or a combination of equity and bond funds.

PAMI chief executive officer Ferdinand L. Berba said that the peso-denominated equity funds grew over 40-percent year-on-year, and it accounts for 35 percent of total funds.

“Including the balanced funds, they account for 70 percent of total AUMs,” Berba said.

The more conservative albeit “safer” peso and dollar bond funds, money market funds, and the rest of the funds have remained flat in terms of growth as the market’s appetite are more aggressive.

In a five-year horizon, the equity and balanced funds have grown double digits while the rest of the funds averaged single digit returns.

The Philam Strategic Growth Fund or the equity fund reflects a growth rate of 17.36 percent in five-year return versus the 6.74 percent of the Philam Bond Fund.

Berba said that the Philippine Stock Exchange Index (PSEi) is forecast to end the year in the 7,200 to 7,300 levels. Equity funds are invested in listed companies in the PSE.

“Next year, our managers estimate that the PSEi will reach the 7,500 level mid-2015, and the full year 2015 level of 7,800 level,” the PAMI chief executive said. “The time to invest is now!”

Initial minimum investments in PAMI funds is P5,000 and minimum additional investments of P2,000.

The investment levels are among the lowest in the market making it attractive to the retail or individual market. “That’s our market.”

Berba said that the savings and investment appetite of the market has improved with individual investors taking more risk for higher returns albeit longer term.

It is reflected in the huge investments in the equity and balance funds.

“Further financial literacy opportunities however is still needed to educate the market about these funds, i.e., where to invest, when to transfer or remit funds, fund selections depending on the individual’s earnings and spending planning, and the like,” he added.

The country’s mutual fund industry reported a record AUM level of P206.9 billion in 2013, or 41.5 percent better than the P146.2 billion recorded in 2012.