MANILA, Philippines – The Bank of the Philippine Islands (BPI) is managing P370-billion worth of assets, making it the biggest assets under management (AUMs) by a domestic commercial bank.
Total AUMs under trust funds managed by the commercial banks is reportedly worth P1.3 trillion.
Majority of AUMs managed by BPI are invested in fixed income instruments, which offer a safer haven for investors with lower tolerance for risks, yet better returns than savings or special savings instruments.
“We are still catering to clients on conservative investments, short-term investment requirements,” BPI executive vice president and head of BPI Asset Management Group (BPI AMG) Adelbert A. Legasto said.
“There has been however a noticeable shift to medium- to long-term market, which is investing funds on corporate bond issues,” he added.
In the first quarter of the year, reputable companies have issued debt papers to raise capital, which has attracted individual and institutional investors.
Some of these are Globe Telecommunications, Ayala Land Corp., the Philippine Long Distance Telephone Co. (PLDT), Robina Farms, and San Miguel Corp.
However, there are strong indications that most of the companies are front loading or raising capital within the first semester, and that there may be a draught in the second semester.
Legasto explained that many corporates would like to avail of funds early as there are strong indications that funds may not be available in the second semester based on the forecast poor performance of the economy in that period.
“Companies want it have the flexibility to move around and continue to their programs, by getting their funding at the start of the year. Most likely, there will be less in the second semester,” the BPI executive vice president said.
“Fixed income funds will continue to dominate the market, as clients prefer to stay conservative, and risk adverse although there will still be trickles going to the equity markets,” Legasto said.
Trust funds offered by the BPI include the BPI equity fund, balanced fund, global Philippine fund, dollar bond index fund, global equity fund, international fund plus, gold fund, short term fund, premium bond fund, and an institutional fund.
Last year, BPI managed AUMs worth P290 billion grew with a market share of 20 percent of the total AUMs managed by commercial banks. Its unit investment trust fund (UITF) in the bond market grew by 3.95 percent while the peso bond fund by 4.21 percent.
The BPI asset group also manages mutual funds in the equity, fixed income, balanced, peso and dollar fund.