At the end of October 2023, the NAV of Croatian pension funds amounted to EUR 19.3bn, decreasing by 0.3% MoM, but increasing by 10.1% YTD, and 11% YoY.

The Croatian Financial Services Supervisory Agency, HANFA, has published the latest report on the developments recorded by Croatian capital markets. In this overview, we’ll look at the performance of the Croatian pension funds. According to the report, the Croatian pension funds NAV recorded a 0.3% decrease MoM, but an increase of 10.1% YTD, and 11% YoY, amounting to EUR 19.3bn. Furthermore, the net contributions into the funds amounted to EUR 109m during October, and EUR 1.03bn since the start of 2023.

Croatian mandatory pension funds AUM structure change (January 2018 – October 2023, EURm)

Source: HANFA, InterCapital Research

In terms of the changes to the asset structure of the funds, on a MoM basis, the only increase was recorded by bonds, which grew by EUR 294m, or 2.4%, amounting to EUR 12.4bn. All other asset categories recorded a MoM decrease. Leading the way in this regard are money market holdings, which decreased by EUR 99m, or 39.8%, followed by shares at EUR 96m, or 2.2%, and inv. funds, at EUR 93.5m, or 4.2%. Deposits and cash also recorded a decrease, albeit a smaller one at EUR 32.9m, or 5.7% MoM. Meanwhile, on a YoY basis, bond holdings grew by EUR 1.4bn, or 13.1%, followed by shares, at EUR 765m, or 22.4%, and inv. funds, at EUR 171m, or 9%.

Turning our attention to securities and deposits, in total they amounted to EUR 15.2bn during October, representing an increase of 7% YoY, but remaining roughly unchanged MoM. Of this, domestic securities and deposits accounted for 90% of the total, increasing by EUR 38.7m, or 0.3% MoM, and EUR 686m, or 5.3% YoY. Foreign securities and deposits, on the other hand, recorded a 3% decrease (or EUR 49m) decrease MoM, but a 6.6% (or EUR 254m) increase YoY.

Current AUM of Croatian mandatory pension funds (October 2023, % of the total)

Source: HANFA, InterCapital Research

Finally, taking a look at the current asset structure of the funds, we can see that bonds still dominate, at 64.3% of the total, which is an increase of 1.72 p.p. MoM, and 1.15 p.p. YoY. Following them there are shares at 21.7%, with a decrease of 0.43 p.p. MoM, but an increase of 2.02 p.p. YoY. Lastly, there are inv. funds, which account for 10.7% of the total, which is a decrease of 0.45 p.p. MoM, but an increase of 0.19 p.p. YoY.