At the end of April 2024, the Croatian mutual funds NAV increased by 1.8% MoM, and 32% YoY, amounting to EUR 2.61bn. This marks the largest YoY growth since the beginning of 2017, marking a solid acceleration in their development. Furthermore, due to this growth, the NAV of the mutual funds stands at “only” 15.7% lower than its pre-COVID-19 maximum.
According to the latest report on the Croatian mutual funds released by the Croatian Financial Services Supervisory Agency, i.e. HANFA, the Croatian mutual funds NAV have recorded significant growth in April 2024, by 1.8% MoM, and 32% YoY. This would mean that the NAV amounted to EUR 2.61bn, coming closer to the pre-pandemic maximum, being only 15.7% lower than it. Furthermore, the NAV’s growth rate on an annual basis was the largest ever since the beginning of 2017.
To understand how this development happened, we should take a look at the main drivers, i.e. the change in the underlying value of the assets, as well as the net contributions into the funds. Starting off with the latter, the net contributions in April amounted to EUR 60.8m, being primarily driven by investments into cash funds, which on a net basis amounted to EUR 66.6m. The majority of other fund types didn’t record a significant change, except bond funds, which recorded net redemptions of EUR 8.4m during the month. Meanwhile, in the last twelve months ending in April, the net contributions amounted to EUR 558.6m, while during the same month last year (also on a TTM basis), they amounted to EUR -221m. As such, it could be said that retail sentiment and confidence have contributed significantly to the development of the fund’s NAV.
Net contributions to the Croatian mutual funds (January 2021 – April 2024, EURm)
Source: HANFA, InterCapital Research
In fact, if we look at the absolute changes, the NAV change on the annual and monthly basis amounted to EUR 632.6m, and EUR 45.5m, respectively. As such, 88% of the annual growth came from the net contributions, while the change in the value of the assets of these funds was actually negative on a monthly basis, as the net contributions were higher than the MoM change (EUR 60.8m vs. EUR 45.5m). As the asset structure of the funds is a “balance sheet” showing the value at a certain date, the net contributions still increase, leading to a positive monthly change.
Moving on to the change in the value of the assets of the funds, on a monthly basis, the largest change was recorded by the money market holdings, which grew by 36%, or EUR 37.7m, followed by deposits and cash, which increased by 8.7%, or EUR 31.9m. On the other hand, bonds decreased by 1.4%, or EUR 20.8m, investment funds decreased by 5%, or EUR 10.4m, while the other assets category decreased by 95%, or EUR 14m. Meanwhile, on an annual basis, bonds recorded the largest increase, growing by 21.5%, or EUR 255m, followed by deposits and cash at 59%, or EUR 147.7m, shares at 40.4%, or EUR 124m, as well as the money market holdings, at 59%, or EUR 147.7m. The only category to record a decrease was the investment funds, which declined by 5.1%, or EUR 10.5m.
Total assets of the Croatian mutual funds (January 2015 – April 2024, EURm)
Source: HANFA, InterCapital Research
In terms of the securities and deposits, in total they amounted to EUR 2.56bn, growing by 1.4% MoM, and 35.7% YoY. Of this, domestic securities and deposits amounted to EUR 906.7m, growing by 3.5% MoM, and 11.7% YoY, while foreign securities and deposits amounted to EUR 1.65bn, growing by 0.3% MoM, and 53.8% YoY.
Lastly, looking at the current asset structure of the funds, bonds still hold the majority at 54.7%, declining by 1.49 p.p. MoM and 4.62 p.p. YoY. Following them there are shares at 16.4%, declining by 0.19 p.p. MoM, but increasing by 1.01 p.p. YoY, as well as deposits and cash at 15.1%, with growth of 1.04 p.p. MoM, and 2.59 p.p. YoY.
Current AUM of Croatian mutual funds (% of the total, April 2024)
Source: HANFA, InterCapital Research
