At the end of October 2022, Slovenian mutual funds AUM amounted to EUR 3.98bn, representing a decrease of 8.2% YTD, 3.7% YoY, but an increase of 3.1% MoM.

The Slovenian Securities Market Agency (ATVP) has recently published its latest report on the developments and changes recorded by the Slovenian mutual funds, for October 2022. According to the report, by the end of the month, the Slovenian mutual funds’ assets under management (AUM) decreased by 8.2% YTD, 3.7% YoY, but managed a decent increase of 3.1% MoM, showing that even though the asset value is on a negative trajectory, the decline is slowing down.

This can be attributed to several factors. First of all, the inflation growth amounted to 9.9% during the month, recording the 2^nd month of decline on a yearly basis. However, this can also be due to the inflation already being elevated during October 2021, thus leading to a higher base. Even so, the slowdown in inflation is always positive news on the financial markets. As such, the equity market did record a slight rally during the month (SBITOP increased by 5.6% MoM) and considering the majority of asset holdings (69.6%) of investment funds are shares holdings, they also experienced an increase. Also, the energy situation, although volatile in Europe, has stabilized somewhat, at least when it comes to energy prices. Finally, the conflict in Ukraine is ongoing, but the impact on the rest of Europe is somewhat limited (except for higher prices).

This is reflected if we look at the asset structure of the Slovenian funds. In fact, share holdings amounted to EUR 2.77bn at the end of October 2022, representing an increase of 5% MoM, but a decrease of 5.6% YoY. Of this, the vast majority of investments (98%) are into foreign issuers’ equity securities, while only 2% are in home issuers. This would mean that home issuers’ equity securities amounted to EUR 54.5m, which is an increase of 2% MoM, but a decrease of 22% YoY. At the same time, foreign issuers’ equity securities amounted to EUR 2.72bn, which is an increase of 5.1% MoM, and a decrease of 5.2% YoY.

Equity holdings of Slovenian UCITS funds (October 2007 – October 2022, EURm)

Source: ATVP, InterCapital Research

Next up, we have bond holdings, which held 15.8%, or EUR 629m, representing an increase of 0.3 p.p. YoY, but a decrease of 0.3 p.p. MoM, in the total asset structure. Following them we have money market, deposits & cash, which amounted to 8.1% of the total (or EUR 323m), representing an increase of 2.6 p.p. YoY, but a decrease of 1 p.p. MoM. Finally, we have investment funds, with 6.1% of the total (or EUR 242m), representing an increase of 0.1 p.p. MoM, and a decrease of 1.4 p.p. YoY.

Total assets of Slovenian mutual funds (June 2007 – October 2022, EURm)

Source: ATVP, InterCapital Research

What hasn’t changed despite the volatility on the market, is the amount of net contributions into the funds, which amounted to EUR 16.3m in October. However, if we look at the data from the last twelve months, this is a slowdown, as in total, the net contributions during this period amounted to EUR 290.7m, a decrease of 31% YoY. Finally, the number of subscribers to the funds amounted to 506.1k, representing an increase of 3.4% YoY.

Net contributions into the Slovenian mutual funds (January 2016 – October 2022, EURm)

Source: ATVP, InterCapital Research

NLB announced it is planning to issue Tier 2 subordinated notes. The company has decided to issue the notes in the aggregate nominal amount of EUR 225m. The interest on the principal will accrue at the interest rate of 10.75% per annum and the issue price will equal to 99.1% of their nominal amount.

Yesterday, NLB announced it is planning to issue Tier 2 subordinated notes. On the basis of orders received from counterparties and clients, the company has decided to issue the subordinated notes in the aggregate nominal amount of EUR 225m. The interest on the principal will accrue at the interest rate of 10.75% per annum and the issue price will equal to 99.1% of their nominal amount.

Further, the notes are expected to be issued on 28 November 2022 with a maturity date on 28 November 2032 and the issuer will have the option for early redemption on 28 November 2027.

The ISIN code of the notes will be XS2413677464.

NLB Share price [2020 – 2022]

Source: Bloomberg, InterCapital Research

At the end of October 2022, BET increased by 1.5% MoM, while on a YTD basis, it decreased by 17.3%, ending October at 10,802.67 points.

The Bucharest Stock Exchange has published its monthly trading data for October 2022. In it, Stock Exchange highlighted that the number of direct investors at the BVB is continuously increasing for the 11th consecutive quarter and reached 128,000 investors for the first time. Further, in the first 10 months of 2022, over 1.43 million transactions were made with all types of financial instruments. At the same time, the total equity turnover amounted to EUR 2.1bn in the first ten months (+24.2% YoY), which translates into a daily trading turnover of EUR 10m.

The higher levels of trading and volatility can currently be recorded on equity markets across the world. The current situation in Ukraine is by far affecting the commodity market (and by extension energy prices) the most, causing inflation. Considering that several of the largest companies listed on the BVB are energy production companies, this increased trading volume is not surprising.

However, the end of October recorded worse performance on the BVB, as the BET-TR index ended October 31, declining by 9.1% compared to the end of the last year, which is a result of strong performance achieved in 2021 when the BET-TR increased by as much as 40%, so correction territory should not surprise. Further, the BET-NG index (which tracks energy and related activities), decreased by 7.7% in the first ten months of trading due to the very high base, as this index noted the biggest increase in price in the previously observed periods.

Moving on to the companies which constitute the largest Romanian Index, BVB, only 5 out of 20 companies decreased during the month, but at the same time, a lot of the companies remained quite stable at +/- 2%. Looking at the companies themselves, Teraplast recorded the largest relative increase, growing by 9.9% MoM, followed by Petrom, which increased by 8.1% MoM. Further, Alro noted an increase of 8% during October. On the other hand, Nuclearelectrica decreased by 5.4%, Romgaz by 4.1%, Transgaz by 3.4%, while Digi decreased by 2.9%. The YTD decreases in financial companies (Banca Transilvania, BRD) can be attributed to the current macroeconomic situation in Romania, and especially the inflation rate, which hit 15.3% in October, still an increase YoY. To combat this, the Central Bank has been increasing the interest rates, which again, affects the profitability of financial institutions.

Performance of BET constituents in October 2022 (%)

In total, the BET index ended the month at 12,802.67 points, which is an increase of 1.5% MoM, and a decline of 17.3% YTD.

Here you can find the dates for the upcoming events of the regional companies.

Due to the nature of these events, they are subject to change (might be postponed or canceled).