GERMANY - US asset management company State Street Global Advisors (SSGA) saw its assets under management in Germany and Austria grow by €800m last year.

The German operation has announced its asset under management rose by 4.8% to €17.3bn in 2007, compared to a 23% increase in the year before.

The Munich-based asset management firm revealed during the presentation of its annual results inflows worth €252m in 2007, just over a tenth of the inflows for the previous years, 2006 and 2005.

In contrast, SSGA's German arm recorded net inflows of €1.9bn in 2006, while booking inflows of €2bn in 2005.

The firm said it saw "strong growth" in its business in Publikumsfonds, the public funds or retail-oriented mutual funds. The assets managed in such funds grew by 33%, as more institutional investors decided to invest in the product.

Klauws Esswein, head of the German opersation, commented: "SSGA has profited considerably from the further diversification of the invested assets of insurers and pension funds."

He added around 98% of SSGA's new business in Germany is now placed in non-indexed, or active strategies.

Esswein predicts the current market situation and investor's appetite for security will lead to an increased search for money-market products and passively managed Euro government bonds.

"On top of that, the trend of diversification of equity investments outside of Europe will continue in our opinion," he said, concluding the Asia-Pacific region is of particular interest to investors.

The company, which opened an office in Frankfurt earlier this year, said it will continue to recruit people to its German operation.

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