BDO trust funds grow 165% to P227 B in 2013

MANILA, Philippines - The unit investment trust fund (UITF) of BDO Unibank Inc. grew 165 percent from P85 billion at the start of 2013 to P227 billion by the end of the year.

Subsequently, BDO’s total assets under management (AUM) ballooned to P772 billion, grabbing 30 percent of the market.

Industry-wide, total AUMs handled by the country’s banks stood at P2.57 trillion last year.

UITFs are a pool of investments made by individuals and institutions with a trust department of a bank, and licensed by the Bangko Sentral ng Pilipinas (BSP).

The funds are invested in various instruments of growth such as the equity or stock market, the fixed income or bond market, money market, and similar instruments but denominated in foreign currency.

BDO attributed the steady growth of UITFs to the introduction of investment funds that mirror the special deposit accounts (SDAs), which has been seeking similar or better returns than the two-percent interest rate offered by the BSP.

Investors to the SDA are basically parking their savings with the guaranteed returns promised by BSP. But the lower interest rate of SDA forced investors to seek other options.

“We offered new and re-tooled investment products to attract would-be migrating SDAs, thus allowing us to retain majority of the investment accounts,” Ador Abrogena, BDO executive vice president and Trust and Investments Group head, explained.