Germany H1 report: Fund industry’s assets exceed EUR 4,600 billion
- Retail funds and Spezialfonds record EUR 64 billion new money
- Bond funds top sales list
- Private equity dominates closed-ended funds
By mid-year, fund companies had a total of EUR 4,625 billion on behalf for investors in Germany. In the last five years, assets have increased by EUR 1,286 billion (compared to EUR 3,339 billion on 30 June 2020). This equates to an average annual increase of almost 7 per cent. The majority of AuM is in open-ended Spezialfonds (EUR 2,208 billion). Pension schemes (EUR 784 billion) and insurers (EUR 530 billion) are the largest investor groups of Spezialfonds. Open-ended retail funds managed EUR 1,702 billion, discretionary mandates EUR 652 billion and closed-ended funds EUR 63 billion.
In the first six months of the year, open-ended retail funds drove new business in Germany. They attracted EUR 47.8 billion. Bond funds led sales with EUR 22.7 billion, driven by funds investing in bonds with
maturities up to three years (EUR 13.6 billion) and those focused on corporate bonds (EUR 6.9 billion). Equity funds recorded net inflows of EUR 19.6 billion. Of this, EUR 19.3 billion was allocated to equity ETFs. Money market funds followed with EUR 5.7 billion and balanced funds with EUR 2.7 billion. Outflows from property funds continued, totalling EUR 3.7 billion in the first half of the year. Since the beginning of the year, their net assets of property funds have declined from EUR 122 to EUR 118 billion.
Equity funds continue to lead retail fund assets with EUR 825 billion, followed by balanced funds at EUR 366 billion. Of the EUR 286 billion held in bond funds, EUR 129 billion is invested in euro-denominated bonds and EUR 70 billion in corporate bonds. Across all asset classes, ETFs account for EUR 423 billion in assets. This figure is based on a new cooperation between BVI and fund companies issuing ETFs with the central securities depository Clearstream, launched earlier this year. Additional ETF assets from fund companies with ETFs not yet participating in this reporting method – regardless of a BVI membership – as well as ETF assets from other central securities depositories, particularly Euroclear, also contributing to the German market. With an estimated total of over EUR 600 billion, Germany is the largest ETF market in Europe.
Assets in closed-ended funds managed by BVI members have grown from EUR 20 billion in mid-2020 to EUR 63 billion.
Private equity funds are the largest group, accounting for 46 per cent of net assets in closed-ended funds. Property funds make up 32 per cent. Five years ago, they held 50 per cent. The market for closed-ended funds under the Kapitalanlagegesetzbuch (German Investment Code) is mainly driven by institutional investors. Spezialfonds manage EUR 59 billion, accounting for 94 per cent of net assets. Closed-ended retail funds (EUR 4 billion) mostly invest in property.
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