EUROPE - Investment poured back into UCITS funds in the first quarter, surging to more than €49bn against just €1bn in the fourth quarter of 2009, according to the European Fund and Asset Management Association (EFAMA).

Inflows were even more pronounced when excluding hard-hit money market funds, reaching more than €87bn, their highest level since the first quarter of 2006.

EFAMA reported outflows for money market funds for the fourth quarter in a row, with investors withdrawing more than €38bn in the first quarter alone.

However, the trade body said inflows into special funds reserved for institutional investors were “exceptionally strong” at more than €30bn - a 63% quarterly increase and a level that has not been matched since 2003.

Inflows into German spezialfonds grew by 44% to €741bn over the same period, while real estate funds grew by 22% to €228bn.

EFAMA said equity, bond and balanced funds had continued to attract inflows since April 2009.

Seventeen countries recorded positive net sales in the first quarter, with six countries reporting sales of more than €1bn: Finland (€1.1bn), Sweden (€1.7bn), Denmark (€1.9bn), Germany (€3bn), the UK (€5.8bn) and Luxembourg (€41bn).

The southern European countries and France were the only markets to report net outflows.

All countries reported asset growth, apart from Italy and Spain, whose assets declined by less than 1%.

Ireland’s assets recorded the strongest growth at 9.2%, followed by Luxembourg (7.4%), the UK (6.8%) and France (1.6%).

In terms of UCITS assets, Switzerland led the field with 34% growth, followed by Romania (33%), Poland (16%), Hungary (12.5%) and Sweden (10%).