Bulgarian Association of Asset Management Companies Evolution of the Asset Management Industry in...
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Bulgarian Association of Asset Management Companies
Evolution of the Asset Management Industry in Bulgaria
Daniel Ganev,
International Relations, BAAMC
Bulgarian Association of Asset Management Companies 2
BAAMC History & Mission
Founded Nov 30, 2004 by 8 asset management companies
Currently 30 members, 4 more candidates on the way..
Key objective - to reinforce high professional standards & ethical norms; to promote investor trust and confidence; to make fund industry popular in
society
Code of Ethics – adopted Sep 2006; entirely based on fundamental principles of EFAMA
Cooperation with all market institutions, local and international organizations
EFAMA membership pending
Bulgarian Association of Asset Management Companies 3
Members of the Association:
Аврора Капитал КД Инвестмънтс
Актива Асет Мениджмънт КТБ Асет Мениджмънт
Алфа Асет Мениджмънт ОББ Асет Мениджмънт
Астра Асет Мениджмънт Оверон Финанс
БенчМарк Асет Мениджмънт ПФБК Асет Мениджмънт
Болкан Капитал Мениджмънт Райфайзен Асет Мениджмънт (BG)
Варчев Мениджмънт Къмпани Сентинел Асет Мениджмънт
ДСК Управление на активи Синергон Асет Мениджмънт
Експат Асет Мениджмънт Сомони Асет Мениджмънт
Елана Фонд Мениджмънт Стандарт Асет Мениджмънт
Загора Финакорп Асет Мениджмънт Статус Капитал
Златен Лев Капитал Съединение Асет Мениджмънт
Инвест Фонд Мениджмънт Ти Би Ай Асет Мениджмънт
Капман Асет Мениджмънт ЦКБ Асетс Мениджмънт
Карол Капитал Мениджмънт Юг Маркет Фонд Мениджмънт
Пайъниър Инвестмънтс
Bulgarian Association of Asset Management Companies 4
Goals of the Association
To assist, promote and make popular the activities of the asset management companies
To integrate and coordinate the efforts of its members, and to defend their professional interests
To reinforce high standards of professionalism among its members in relation to their activities
Bulgarian Association of Asset Management Companies 5
BAAMC Accomplishments
Important legislative changes – amendments of the Law on Public Offering of Securities and respective ordinances, harmonization with EU directives, tax laws, etc.
List of Measures Aimed at Market Stabilization during crisis
Uniform Industry Rules and Methods – Common table with fund quotes, Funds Classification Methodology (based on FEFSI
Rules), Calculation of Funds’ Returns, Portfolio Valuation and Risk Mgt Rules
Cooperation with professional organizations – Association of Inv Intermediaries, Association of Banks, Association of Pension Assurance Companies, Association of Industrial Capital, Association of IR Directors, EFAMA, World Bank
Educational seminars for the public and professional community - Burov Foundation, Plovdiv International Fair, Pension Companies World Forum, FSC
Exam Board
Bulgarian Association of Asset Management Companies 6
Bulgarian Fund Industry Facts
39 asset management companies
85 domestic mutual funds (UCITS under art. 1 (2) of Directive 85/611/EEC)
Total domestic industry size ~ BGN 330 mln (EUR 170 mln)
42% in equity funds (down from 60% at the peak), 37% in balanced funds, 13% in money mkt funds (strong demand YTD similar to Western Europe),
9% in bond funds
Current ownership structure of funds: 1/3 households, 1/3 corporate, 1/3 institutional
Foreign funds distributed in Bulgaria – 7 different families
Bulgarian Association of Asset Management Companies 7
Bulgarian Funds Statistics
813
39
71
85
0
10
20
30
40
50
60
70
80
90
# funds
2004 2005 2006 2007 2008
Number of Mutual Funds in Bulgaria
Bulgarian Association of Asset Management Companies 8
Bulgarian Funds Statistics
Evolution of Bulgarian Mutual Funds Industry
1748
159
452
163
3 4 7
170
0.1% 0.1% 0.1%0.2%
0.5%
1.3%
2.9%
1.0% 1.1%
0
50
100
150
200
250
300
350
400
450
500
2001 2002 2003 2004 2005 2006 2007 2008 2009*
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
FundsAssets(EUR mln)
Funds as% ofHouseholdFin Assets
Bulgarian Association of Asset Management Companies 9
The crisis in numbers
2/3 erosion of aggregate funds assets : from EUR 500 mln (Oct’2007 peak) to EUR 170 mln (current low)
Half of decrease due to net redemptions, the other half –stocks’ depreciation
Bad news catastrophic 2008 - funds shed a quarter of a billion EUR
Good news we survived!
Bulgarian Association of Asset Management Companies 10
Crisis Measures Undertaken
Regulator frequent communication with fund managers, statistics gathering and analysis, flexible approach and understanding
BAAMC regular meetings, constant communication & discussions on possible scenarios, team spirit!
Fund manager risk management, liquidity watch, investor relations, regular updates & info dispatch
No fund ever closed redemptions! no single suspension of exchange trading! no single official investor complaint!
Most actively managed funds performed better than benchmark!
Bulgarian Association of Asset Management Companies 11
Expected Development
Expense optimization, structural changes, outsourcing back-office functions
Software upgrades, IT modernization, smaller teams
Greater investor choice, new distribution channels, lower fees
Flight toward index and more passively managed strategies
Lower risk appetite, global bias vs. domestic focus
Custom-tailored products, private banking, discretionary accounts
Bulgarian Association of Asset Management Companies 12
BAAMC Contact Info:
Daniel GanevInternational Relations, BAAMCTel: (+359 2) 4008 300E-mail: [email protected]