The Serbian investment fund market
Raiffeisen Invest a.d. Beograd– a leading position
The Serbian investment fund market began developing in 2006 when the first asset management company was founded. Raiffeisen Invest a.d. Beograd, a subsidiary of Raiffeisen Bank, was one of the initial players in the market. Since then, the company has maintained a leading position in moving markets by introducing new products, funds, and ideas.
By the end of August 2024, the value of assets managed byRaiffeisen Invest a.d. Beograd had increased by an impressive yearly rise of 82.98% to around 750.91 million euro, with a market share of around 55.49%compared to the total net asset value of all funds in the Serbian market, which grew by approximately 90% to around 1.353 billion euro.
Other major participants in the market are asset management companies (AMCs) established by international banking groups. These include:
INTESA INVEST (37.7% market share)
WVP Fund Management company (2.6% market share), founded by Austrian insurance brokerage group WVP Graz
KOMBANK INVEST (3.1% market share), founded by the Slovenian NLB banking group
OTP INVEST (0.8% market share), which entered the market in 2023 by acquiring ILIRIKA INVESTMENT AMC, previously founded by Slovenian Ilirika brokerage financial group.
All those AMCs are licensed to manage UCITS funds*, while only Raiffeisen Invest a.d. Beograd and INTESA INVEST are also licensed to manage AIF/non-UCITS/ funds. Additionally, there are several AMCs licensed solely for managing alternative investment funds (AIF), but with a relatively small amount of assets under management (AUM).
By the end of August 2024, UCITS funds and AIF funds dominated the market with 30 registered funds amounting to approximately 1.353 million euro of AUM in total. Money market funds dominated with 89.49%, followed by equity funds at of 5.60%. Regular investment remained the dominant way of investing compared to fund saving plans.
The Serbian pension sector
Serbia's pension sector has undergone significant transformations since the enactment of the Law on Voluntary Pension Funds and Pension Schemes in 2006. This legislative milestone paved the way for the establishment of the first voluntary pension fund management company (VPFMC), Delta Generali, marking the inception of a dynamic and evolving industry landscape.
As of June 30, 2024 Serbia boasts four VPFMCs overseeing the assets of seven voluntary pension funds (VPF), with the total net asset value amounted to 490 million euro, each contributing to the diversification and sophistication of the market. Notably, Generali Index and Raiffeisen Euro Future distinguish themselves by exclusively investing in euro-denominated securities, reflecting strategic asset allocation decisions within the sector.
A brief historical overview reveals the diverse trajectories of key market players.
Raiffeisen Future a.d. Beograd stands out as the sole entity to commence operations from a "zero position" in terms of assets under management, illustrating its journey towards prominence within the industry. Conversely, Dunav, Generali, and DDOR-Garant VPFMCs transitioned from prior engagements in voluntary pension insurance to emerge as significant players in the VPF landscape, leveraging their experience and market share to drive growth and innovation.
Among the major players shaping Serbia's pension industry, Dunav VPFMC commands a substantial market share of 41.9%, owned by the biggest state insurance company DUNAV. The company has a huge number of members with a focus on workers of big public companies through pension plans.
Generali VPFMC, owned by Generali insurance, follows closely with a market share of 30.8%. A significant number of members conduct purchases through Generali insurance sales managers and network branches. They offer a combined product, VPF & Insurance.
DDOR-Garant VPFMC, owned by three insurance companies, with a market share of 14.2%, has robust local insurance brand presence and occupies a notable position in the market. The growth strategy involves mergers, consolidating five VPFs.
Raiffeisen Future a.d. Beograd, owned by Raiffeisen Banka a.d. Beograd, with a market share of 13.2%, benefits from a large network of branches and professionals licensed by the National Bank of Serbia, available to their members. Since 2013, it has contributed the highest number of individual contracts in the VPF Market, leveraging the strength of Raiffeisen Banka as a brand.
Strategic goals of Raiffeisen Future a.d. Beograd
With its leading role in bringing digital solutions to fund members, Raiffeisen Future a.d. Beograd remains committed to driving innovation. The strategic goals, including the development of digital solutions such as REA ChatBot, mobile app development, and digital customer acquisition, underscore the dedication to advancing the industry and serving the evolving needs of their customers.
Additionally, in terms of investment, Raiffeisen Future fund is the first fund on the market that has invested its assets abroad up to 10% of the fund’s assets, which is the legal maximum. The assets are invested in foreign equity with the aim of improving investment diversification and achieving potentially higher returns in the long term.
* UCITS: The Undertakings for the Collective Investment in Transferable Securities (UCITS) is the European Commission's regulatory framework for managing and selling mutual funds. UCITS funds can be registered and sold in any country in the European Union using unified regulatory and investor protection requirements.
Source: Raiffeisen Invest a.d. Beograd, Raiffeisen Future a.d. Beograd, as of August 2024