Above average-income individuals are the first to shift from savings to investments in funds, according to Catalin Vasile, head of ING’s retail sales management department.
The 1.4 billion lei that entered the accounts of mutual funds in the first four months of this year testify that a rising number of Romanian clients of banks have grown dissatisfied with deposit interest rates.
Domestically, a less exploited niche at present is that of mutual funds with investments on international markets, a segment ING Bank has recently started tapping by opening distribution in all its banking units.
“We want to attract 20% of the assets of top affluent clients, with monthly income of above EUR2,000 or placed assets of above EUR50,000,” said Catalin Vasile.
ING Bank has 50,000 clients in the top affluent category.
The sum raised by the ten international mutual funds managed by ING Investment Management in the first five months of this year reached EUR4.5 million. Average investments in these funds stood at EUR15,000 per client, but the minimum starts from several thousand euros.
The package of 10 mutual funds distributed domestically includes eight EUR and dollar-denominated international investment funds and two funds with RON-denominated placements on the domestic market.
The best-performing fund is Euro High Dividend equity fund, with a 27% yield in euros in the past 12 months.
Starting this autumn, ING Bank will introduce a service providing investors with online access to their own fund portfolio on its internet banking platform.
Beside ING Bank, Pioneer Investments also distributes international investment funds through UniCredit Tiriac Bank units. Erste and Raiffeisen, the largest mutual fund managers in Romania, sell foreign investment funds through BCR and Raiffeisen Bank units. Alpha Bank sells foreign funds managed by the Athens arm. US Franklin Templeton, the manager of Proprietatea Fund, is the newcomer on the market, selling 11 international investment funds in Romania.
The fact that the world’s major asset managers are distributing their own investment funds in Romania may be seen as an indicator of the market’s potential. However, statistical data shows development will be a lengthy process. In the first 10 months of this year, Romanian investors withdrew RON3.2 million from foreign funds distributed domestically.
(English version by Catalina Apostoiu)