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Spezialfonds’ assets fall in 2001 to €507bn

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Germany-The value of German Spezialfonds invested assets fell in 2001 by 1.4% to €506.9bn, their first fall in the 33-year long history, according to Spezialfonds expert Hans Karl Kandlbinder, a consultant based in Grafing near Munich. But the number of funds rose to 5,550, compared with 5,328 in 2000, he pointed out.

The fall was due more to the decline in worldwide capital markets than a fall in sales, although new inflows into Spezialfonds declined to €41.3bn last year, compared with €45.4bn in 2000. “This development did not come as a surprise, since volume growth rates had declined over the past few years,” he said, when speaking at a conference in Munich.

The volume of mutual fund sales to the public declined to E25bn in 2001, down from €42.5bn the previous year, with the value of these funds falling by 4.2% to €247bn. In contrast, real estate funds saw their investment inflows soar to E10.2bn, contrasting sharply with the outlow of €2.8bn in 2000. The total invested in these funds at year end was €59.2bn (€48.9bn).

“The inflow into Spezialfonds was almost twice that into the public investment funds,” Kandlbinder pointed out. “I predict the influx of new money into Spezialfonds will continue in the years to come at the rate of €40bn to €50bn annually.”

Of those Spezialfonds investing in securities, both equities and debt, the proportion invested abroad rose to 51.4% in 2001, the first time it has exceed the 50% mark, though the proportion has been rising steadily from 18% in 1996. However the trend to equity investment was reversed in 2001, with the equity content of Spezialfonds shrinking to 38% (45% in 2000), of which 29% was non-German and 9% domestic shares.

Pensionskassen had invested 31% of their overall assets of €71bn in Spezialfonds, equivalent to 58% of their securities investments at the end of 2000, Kandlbinder noted, adding: “Once can be sure that the new ‘Reister pension funds’ will use Spezialfonds vehicles at to the same extent.” Additional flow of funds to the Spezialfonds would be generated from the Reister pension, he maintained.

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