Fund managers in Nigeria grew mutual fund asset value by an average of 89.71% in 2017, according to research conducted by Quantitative Financial Analytics. Nigerian fund managers began the year with a total mutual fund asset of about N224 billion but ended the year with assets worth N426 billion, representing an increase of N202 billion. The increase, according to the research, emanated from net inflow of about N186 billion and performance gain of about N16 billion.
The Fastest Growing Fund Manager
AXA Mansard Investments Limited was the fastest growing fund manager in Nigeria during the 2017 fiscal year. It raked in a net-inflow of N7.8 billion to bring its beginning net asset value of N2.6 billion to N10.4 billion, representing a growth of 301%. Though that net-inflow appears to be small compared to the N104 billion and N44 billion or even the N12 billion pulled by Stanbic IBTC Asset Management, FBNQuest Asset Management Ltd and Asset Resources Management (ARM) respectively, but when viewed in relation to their respective fund sizes, it becomes apparent why AXA Mansard Investments Limited can proudly say that it grew its asset under management (AUM) more than anyone else in 2017.
AXA Mansard Investments Limited manages two funds at moment, AXA Mansard Money Market Fund which grew by 309%, from N2.5 billion to N10.2 billion, and AXA Mansard Equity Market Fund, that grew by 118.47%, from N107 million to N234 million, giving the fund manager an average NAV growth rate of 301%. That feat pushed AXA Mansard Investments up as the 6th largest fund manager by asset in Nigeria from its position as the 12th in 2016. Currently, it has moved up one notch, to occupy the 5th position as at May 4, 2018
The second fund manager in the growth continuum is FBNQuest Asset Management, with a growth rate of 137.54%. FBNQuest Asset Management which was a N32 billion fund manager as at the end of 2016, increased its AUM to N77 billion after pulling in an estimated N43 billions of net-inflow and N1.1 billion in fund performance. FBNQuest Asset Management currently manages 6 mutual funds spread around the Euro Dollar, Equity, Money Market and Fixed income fund spaces. It is also the second largest fund manager in Nigeria, a position the fund manager is not giving up anytime soon.
Then comes the biggest of them all, Stanbic IBTC Asset Management company, which took the third position in the fast growth chart. Stanbic Asset Management company ended 2016 as the largest fund manager by asset with an asset under management of N86.8 billion. After plowing in an estimated net inflow of N103 billion and raking in an estimated profit of N4.8 billion, it consolidated its leadership position with an asset under management of N195.3 billion.
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Though the fund manager generated the largest net inflow, but because of its asset size, its growth rate in 2017 was a laudable 125.1%. Stanbic IBTC is not just the largest fund manager by asset, it is also the fund manager with greatest number of mutual fund products. It currently manages 13 mutual funds putting its tentacles in every category of mutual funds in Nigeria.
Those That Experienced Decline in Assets
2017 was indeed a good year for fund managers as 26 out of the 28 of them saw their asset under management grow by at least 2%. The only two fund managers that saw their assets dwindle were Capital Express Asset & Trust Ltd and Afrinvest Asset Management.
Capital Express Asset & Trust Ltd, which began the year with an asset value of N343 million, suffered a net outflow of N98 million. Its attempt to shore up its AUM with a profit of N95 million failed as the AUM at the end of the year fell by 1% to N340 million. Capital Express Asset & Trust Ltd manages only one fund, the CEAT Fixed income fund, according to available NAV Summary report from the Security and Exchange Commission (SEC). Capital Express Asset & Trust Ltd now moves to the 27th position from its 23rd position in 2016. Attempts to get the fund manager to explain what is being done to recoup on the AUM failed as emails were not responded to.
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Afrinvest Asset Managers was the hardest hit as it suffered a whopping 6.67% reduction in its AUM. It’s AUM had stood at N1.5 billion by the beginning of 2016, but the effect of a net outflow of about N328 million which outweighed its estimated performance of N227 million, left it leading the group of fund managers with diminished asset value.
Afrinvest Asset Managers are the overseers of Afrinvest Equity fund and Nigeria International Debt fund, both of which suffered net outflow but the performance from the equity fund was enough to negate the effect of the outflow from that fund, leaving the Debt fund as the reason for the reduction in AUM. With AUM of N1.4 billion as at the end of 2017, Afrinvest Asset Managers fell to the 20th position from its 2016 14th position of fund manager AUM ranking.
In an email exchange with Afrinvest Asset Managers, the fund management company attributed the decline in AUM to redemptions that happened at the end of year but noted that “the funds AUM has grown about 6% YTD” in 2018.