Mutual fund products that invest in offshore markets have become popular among Philippine investors last year, according to Sheila Marie Tan, president at BPI Asset Management and Trust Corporation (BPI AMTC).
“Our foreign investment funds have proven particularly popular, as the pandemic highlighted the need for investors to truly diversify their portfolios,” Tan said in a statement issued by the firm’s parent, Bank of the Philippine Islands (BPI).
The BPI Invest Global Equity Fund-of-Funds and the BPI Invest US Equity Index Feeder Fund were among the fund products that had the highest AUM growth YTD last year ending November, the firm said. However, it did not provide exact AUM and net inflow figures.
The BPI Invest Global Equity Fund-of-Funds invests in global equity collective investment schemes managed by other fund managers. As of the end of November, the fund’s top holdings included three products managed by Wellington Fund Management, a fund from Capital Group and a State Street Global Advisors (SSGA) ETF, according to its fund factsheet.
The BPI Invest Global Equity Fund-of-Funds
|Top Holdings||% of holdings|
|Wellington Global Quality Growth Fund||42.36|
|SPDR S&P 500 ETF||16.3|
|Capital Group New Perspective Fund||11.02|
|Wellington Strategic European Fund||8|
|Wellington Global Innovation Fund||7.31|
Meanwhile, the BPI Invest US Equity Index Feeder Fund invests its assets into SSGA’s SPDR S&P 500 ETF Trust, which tracks the performance of the S&P 500 Index, according to its fund factsheet.
BREACHING THE 1 TRILLION MARK
Separately, BPI said that its assets under management from its consolidated trust and asset management businesses exceeded Ps 1trn ($10.7bn) last year. AUM growth during the year was 14% for the combined AUM of BPI AMTC, with assets of Ps 832bn, and BPI Investment Management (BIMI), with Ps 190bn, according to the statement.
BPI AMTC is BPI’s trust entity, while BPI IM, another subsidiary of the bank, is its investment management company. In the Philippines, collective investment schemes are regulated by different regulators, which results in different terminology.
Banks and their trust departments and stand-alone trusts manage unit investment trust funds (UITFs) and are regulated by the central bank, the Bangko Sentral ng Pilipinas (BSP), while investment management companies manage mutual funds and are regulated by the Securities and Exchange Commission (SEC).
“We are able to grow our AUM in the trust and investment management businesses both organically and through new accounts and fund management acquisitions,” Maria Theresa Marcial, BPI’s chief finance officer, said in the statement.
In 2019, BPI IM announced its plans of acquiring the mutual funds managed by Philam Asset Management. At the time, the acquisition helped triple BPI IM’s investor base to 140,000 from 50,000.
Tan added that despite the pandemic, investors were able to subscribe or redeem investments via online channels, including the bank’s mobile app.
“With many customers having to perform most tasks and transactions online due to social distancing requirements and community quarantine restrictions, clients are appreciative of the ability to do self-service transactions on their devices and in their own time,” Tan said.
BPI aims to further grow its fund management businesses by reaching out to previously underserved and untapped markets through financial inclusion and education campaigns.
For example, BPI AMTC now holds free “Investment 101” webinars that are open to the public. Weekly financial education materials are also posted in its social media pages to reach a wider audience.