At the end of May 2024, the NAV of Croatian mutual funds increased by 2.4% MoM and 33.7% YoY, amounting to EUR 2.67m. This marks the second consecutive month of YoY growth exceeding 30%, a trend not seen since early 2017, indicating strong momentum in NAV development. Despite this increase, the NAV remains 13.7% below its pre-COVID-19 peak.
According to the latest report by the Croatian Financial Services Supervisory Agency (HANFA), the NAV of Croatian mutual funds saw substantial growth in May 2024, rising by 2.4% MoM and 33.7% YoY, reaching EUR 2.67bn. This growth narrows the gap to the pre-pandemic peak, now only 13.7% below it. In April, the NAV recorded a 32% YoY growth rate, the highest since early 2017, and May’s 33.7% YoY growth set a new record once again.
To understand this growth, it is essential to examine the primary drivers: changes in the underlying value of assets and net contributions to the funds. In May, net contributions totaled EUR 25m, mainly driven by investments in cash funds, which accounted for EUR 23.1m. Equity funds followed with net contributions of EUR 1.9m, while other fund types saw no significant changes. Over the past twelve months ending in May, net contributions reached EUR 565.8m, compared to EUR -172m in the same period last year, indicating improved retail sentiment and confidence.
Net contributions to the Croatian mutual funds (January 2021 – May 2024, EURm)
Source: HANFA, InterCapital Research
In terms of absolute changes, the NAV increased by EUR 673.3m YoY and EUR 61.5m MoM. Notably, 84% of the annual growth stemmed from net contributions, while on a MoM basis, app. 40% of the growth came from net contributions. As such, it could be said that in a longer time frame, net contributions had the largest impact, while in the short term, the increase in the value of assets played the more important role, both of which are positive developments.
Examining the monthly changes in asset values, money market holdings saw the largest increase of 17.5%, or EUR 24.8m, followed by shareholdings, which rose by 4.4%, or EUR 18.9m. Other categories combined, i.e. investment funds, bonds, deposits, and cash grew by EUR 22m, while receivables decreased by 10.5%, or EUR 2.4m. Meanwhile, on a YoY basis, money market holdings surged by 353%, or EUR 130m, followed by receivables, which grew by 169%, or EUR 13m. However, the largest absolute increase was in bond holdings, which grew by EUR 253m, followed by deposits and cash at EUR 146m, and shares, at EUR 141m. The only category to decline was investment funds, which decreased by 2.8%, or EUR 5.8m.
Total assets of the Croatian mutual funds (January 2015 – May 2024, EURm)
Source: HANFA, InterCapital Research
Moving on to securities and deposits, in May 2024, they amounted to EUR 2.63bn, growing by 2.9% MoM, and 36.6% YoY. Of this, EUR 1.7bn, or 64.9% was held in foreign securities and deposits, while the remaining 35.1% was held in domestic. Both domestic and foreign securities and deposits grew, both on a MoM and YoY basis.
Finally, taking a quick look at the current asset structure of the mutual funds, the largest share was held by bonds at 53.8%, representing a decrease of 0.99 p.p. MoM, and 5.53 p.p. YoY, followed by shares at 16.7% of the total, growing by 0.32 p.p. MoM, and 1.41 p.p. YoY. Next up, there are deposits and cash, which accounted for 15.1% of the total, declining by 0.04 p.p. MoM, but growing by 2.18 p.p. YoY. Finally, we have inv. funds and money market holdings, which accounted for 7.5% and 6.2% of the total, respectively, recording slight changes MoM, but declining by 2.81 p.p. YoY, and growing by 2.18 p.p. YoY, respectively.
Current AUM of Croatian mutual funds (% of the total, May 2024)
Source: HANFA, InterCapital Research
