Innovation is changing the investment landscape

At the end of June, the fund company's assets under management totalled EUR 44.4 billion* (+7.8% in a 12-month comparison) and thus withstood the global geopolitical risks. Institutional client business in particular grew strongly in a 12-month comparison (+10.1 %). However, business with private investors (+7.3%) also continued to grow. The investment focus here was on megatrends, infrastructure and artificial intelligence (AI). ‘This very pleasing development shows that investment funds can also succeed in an environment of multiple challenges. Very good customer loyalty, strong investment stories for the products and a responsible investment process that sets international standards have made this success possible,’ says CEO Hannes Cizek. Assets under management in the RRBI Group have even risen to EUR 61 billion.

*incl. advisories, excluding Raiffeisen Asset Management

Capital markets defy geopolitical risks

Boosted by AI technology, falling inflation and moderately positive economic momentum, the stock markets have performed surprisingly well this year despite high geopolitical risks. The gloomier economic data was offset for a long time by the prospect of interest rate cuts by the central banks. There was a temporary consolidation on the stock market at the beginning of August - triggered by fears of recession. However, the markets have since recovered. In view of the uncertain development of the global economy and the upcoming US election, volatility is expected to remain high.

Solid growth with responsible investment

At 36.3% market share, Raiffeisen Capital Management is the clear market leader in responsible investing in Austria*. Just a few weeks ago, the prestigious German rating agency Scope confirmed Raiffeisen Capital Management's coveted ‘AAA-ESG Capability Rating’ for the third time in a row. It is only awarded for excellent quality and expertise in the management of sustainable fund strategies. ‘It is important to us that we allow new approaches in our responsible investment process. We have no time to lose and must continue the transformation. And we can only do this by supporting it and not by excluding companies because they have not yet reached the end of the transformation,’ says Managing Director and Chief Sustainable Investment Officer Dieter Aigner. The growth trend in responsible investing continues unabated, partly due to the political requirements for institutional investors. Since 2019, the volume of ESG-oriented investments at Raiffeisen Capital Management has risen from EUR 6.5 billion to EUR 24.4 billion (June 2024).

*Source: rfu research, study: Austrian ESG Funds Survey 2024

Number of fund savings plans remains at a high level

Fund savings play a central role in Raiffeisen Capital Management's business development due to the stable monthly inflows. ‘Although the number of fund savings plans fell slightly in the first six months of the year (-0.4%), we are talking about a very high level here, namely almost 400,000 fund savings plans,’ says Cizek. The average monthly savings amount is basically unchanged compared to the same period and amounts to EUR 140 as at June 2024 (2023: EUR 146). ‘We attribute this development primarily to the high price increase in recent years - fund saving is a very flexible investment instrument that can be adapted very easily to personal possibilities,’ says Cizek.

Sustainability expertise also in high demand internationally

‘In international business, Raiffeisen Capital Management scores particularly well with its high level of credibility in responsible investment. This is also the case in CEE, the Central and Eastern European region,’ explains Michal Kustra, who is responsible for this market within the Management Board. ‘Raiffeisen Capital Management plays a pioneering role in responsible investment in the CEE region. We are pleased that we were able to launch the country's first ESG fund in Albania this year, for example,’ says Michal Kustra. ‘Even though the market is comparatively small, it is important to be a first mover. This gives us a head start for the future,’ Kustra is certain.

Raiffeisen Capital Management also acts as the CEE fund competence centre of Raiffeisen Bank International AG (RBI). According to Kustra, the local asset management companies (LAMCs) of the network banks are also experiencing strong growth. The volumes of these fund companies, together with the pension funds of the network banks, have increased by around 36.1% in the last five years. This year it was 7.1% by June 2024. ‘Fund saving in the CEE region has developed into a real trend,’ says Kustra. The number of fund savings plans here more than tripled from around 117,500 in 2019 to just under 380,000. If all fund savings plans of the RBI Group are aggregated, there are around 780,000 fund savings plans.

Innovative asset management: rethinking responsible investing

‘Given the current major ecological, political and social challenges, the dynamic further development of sustainability is an absolute must,’ Dieter Aigner is convinced. Whereas around ten years ago, scores and certifications were the normative criteria for sustainable investing, today it is essential to make qualitative judgements above all. Exclusions are still justified on the basis of holistic considerations, but now more than ever it is important to see the big picture and take a global view when investing. This also includes supply chains. ‘ESG has now developed into a strategic positioning for companies and investors. This is important and is going in the right direction,’ said Aigner.

The example of infrastructure is a good illustration of the complexity of responsible investment. As a megatrend, infrastructure is constantly characterised by innovations, adjustments and changes. For investors, it is important to recognise investment opportunities. Which innovations in this sector could be forward-looking and therefore of financial interest? What impact do these innovations have on the environment, society or aspects of corporate governance? Where is there scope for engagement in the dialogue with the companies? The comprehensive answers to these questions then form the qualitative basis for a sustainable investment process and the quality of responsible investment decisions. Aigner: ‘This approach not only requires in-depth analysis, but also the willingness to accept unpleasant answers and the courage to derive second-best solutions and best-in-class approaches from them. As an investor, however, you are also dependent on political decisions. ‘Politicians must create the framework conditions for the transformation so that companies have planning security,’ says Aigner. When it comes to infrastructure, for example, it is about ensuring the provision of networks and avoiding monopolistic positions of providers. Focussing solely on exclusion would not help society.

Innovative products for changing investment behaviour

But it is not only fund companies and companies that are subject to dynamic change. The demands and wishes of investors are also changing in line with this transformation. ‘Investors today are much more open to investing in alternative investments,’ says CEO Hannes Cizek. Private markets are becoming increasingly important for institutional clients and in private banking. ‘We want to capitalise on this development and provide customers with a complementary fund of funds solution,’ says Cizek. Thematically, the first product in this series would focus on infrastructure. ‘The prospects for this innovative product solution are very good, as the investment gap in the private market segments is increasing, which requires additional private investments on a large scale,’ Cizek is convinced. Fund of funds constructions are best suited to institutional clients as they offer access to first-class funds and broad diversification, says the CEO.

Raiffeisen Capital Management is also addressing the changing needs of institutional investors with its R-Ratio fund product line. The market-connected, responsibly investing quant funds are orientated towards the respective MSCI indices - in line with the investment focus - but have a carbon footprint that is only half as large and continues to fall.

Digitalisation is progressing

In parallel to the activities described above, Raiffeisen Capital Management is further expanding its digital service offering for customers. ‘The focus here is on a frictionless customer journey through to the fund purchase,’ says Cizek. It is now also possible to take out fund savings plans via the ‘My Elba App’. A ‘buy button’ on the www.rcm.at website also leads directly to the Raiffeisen custody account next to the fund lists, where the desired fund units can be purchased. There are also new login areas for institutional investors and Raiffeisen Asset Management customers. Further digital tools are planned, particularly for Raiffeisen Asset Management, with regard to advice and finalising purchases.

Dieser Text richtet sich an Medienvertreter. Die darin enthaltenen Angaben dienen, trotz sorgfältiger Recherchen, lediglich der unverbindlichen Information, basieren auf dem Wissensstand der mit der Erstellung betrauten Personen zum Zeitpunkt der Ausarbeitung und können jederzeit von der Raiffeisen Kapitalanlage GmbH ohne weitere Benachrichtigung geändert werden. Eine vergangene Wertentwicklung ist kein verlässlicher Indikator für die künftigen Entwicklungen eines Fonds. Die Inhalte dieser Unterlage stellen weder ein Angebot, eine Kauf- oder Verkaufsempfehlung noch eine Anlageanalyse dar.

For further information please contact:

Andrea Pelinka-Kinz (+43 1 717 07 - 8787) or
Pia Oberhauser (+43 1 717 07 - 2426)

www.rbinternational.com and www.rcm.at