The total amount of managed assets in Switzerland rose year-on-year by 10.6% in 2020 to a new record of CHF2.79trn (€2.6trn), pushed by high net inflows and the rebound of financial markets in the second and third quarters of last year, according to a study conducted by the Institute of Financial Services Zug at Lucerne University.
Net inflows totalled CHF100bn across all asset classes and segments last year, which boosted assets under management (AUM) by 4%, the study said.
Assets managed by pension funds made up the largest portion of institutional assets managed in 2020. Some 44.2% of the total AUM in Switzerland was managed on behalf of pensions funds, followed by other institutional clients such as sovereign wealth funds, family offices, governments or corporations (22%), banks (17.4%), and insurers (13.2%).
UBS Asset Management topped the ranking with CHF300bn in AUM, ahead of Credit Suisse Asset Management with CHF297bn, Swisscanto Invest with CHF191bn and Picted Asset Management with CHF173bn.
The study estimated a net revenue pool of CHF15.67bn and a profit pool of CHF4.10bn for asset managers last year.
In terms of asset classes, equities saw the biggest increase in the portfolios of Swiss asset managers, shifting from 27.1% in 2019 to 29.9% last year, while the share of bonds continued to decrease year-on-year from 25.3% in 2019 to 23% last year.
Traditional asset classes including equity, fixed income, multi asset and money market investments make up 77% of total AUM, with the reminder in alternative investments. Private equity (58.6%), private debt (52.4%) and infrastructure (45.3%) were the strongest returning asset classes in 2020, according to the study.
A survey conducted as part of the research showed that asset managers consider sustainable investments the most important opportunity in the asset management industry, with persistently high demand from clients, risks and regulatory requirements driving the trend.
Low interest rates, instead, have changed positively the perception of opportunities in private markets among asset managers, the survey showed.
The study took into account assets managed by banks, securities dealers, fund management companies and asset managers under the supervision of FINMA, the Swiss financial supervisory authority, for institutional clients and collective investments schemes (CIS).
AUM in discretionary mandates for institutional clients amounted to CHF1.12trn last, year, while assets in Swiss open−ended collective investment schemes reached CHF1.1trn, and in foreign collective investment schemes CHF558bn.
Research also showed that 69.6% of the AUM is managed actively while the remaining (30.4%) is passively managed.
Asset managers have generated 81.6% of the revenues through management fees and only 18.4% through performance fees.
Last year, about 65% of AUM were handled for domestic clients, while 35% for clients abroad.
Pension funds remain the largest client segment for Swiss asset managers with assets of over CHF50bn (50.3%) and for managers with assets in the range of CHF10-50bn (48.3%).