Sun Life mutual funds rise to P29 B

MANILA, Philippines - Sun Life Asset Management Co. Inc. (Slamci) said its total assets under management (AUMs) reached P28.7 billion at the end of 2012, or 33.8 percent more than the P21.46 billion in 2011.

Slamci president Valerie N. Pama said P1.5 billion in placements was registered in the month of December alone.

“2012 is one of the best years yet of Slamci,” Pama said.

The chief executive explained that the strength of the bourse had transformed investors to become moderately aggressive in their investment choices, as opposed to the prior years wherein investors were rather conservative and would rather keep their funds in time deposits.

The Philippine Stock Exchange index (PSEi) has been recording new highs since 2012, and is forecast to record new ones this year.

“The increase in the number of accounts, the significant AUM growth as well as the shift into balanced and equity funds illustrates this point,” she added.

In 2011, total number of accounts stood at 26,764, but surged 23.5 percent to 33,060 by end-2012.

Likewise, Slamci expanded its distribution network to 1,540 financial advisors licensed to sell mutual funds as well as added new bank partners to address needs of their wealth management clients.

But the offensive was not isolated to merely selling the funds but spending significant time to individual financial education.

The head of the fund management group of SunLife Financial Philippines said that financial literacy meant educating the financial advisors so they could provide investment insights to their clients, which in turn translated to increased sales in mutual funds.

Slamci manages seven mutual funds under the Sun Life Prosperity (SLP) family of funds, including fixed or bond fund, equity fund, balanced fund, government securities (GS) fund, money market fund, and dollar-denominated funds (Advantage and Abundance).

The SLP Balanced Fund is worth P11.9 billion at the end of 2012, or 37.2 percent higher than the P8.67 billion realized in 2011. Year-on-year, the balanced fund reported a 25.35 percent yield or generally speaking, investments made a year ago grew by 25 percent.

The SLP Philippine Equity Fund has investments worth P8.2 billion, 63.7 percent higher than the P5.05 billion recorded in 2011. Year-on-year yield of the equity fund grew by 32.97 percent.

The SLP Bond Fund assets grew by P5.2 billion, or nine percent higher P4.77 billion in 2011, for a yield rate of 5.7 percent, better than earnings made in a standard savings bank yield of less than one percent.

The other fund performances were: SLP Dollar Advantage Fund grew to P1.19 billion slightly higher than P1.18 billion; SLP GS Fund, P653 million slightly lower than the P684 million; SLP Dollar Abundance Fund, P1.11 billion or 113 percent higher P520 million; and the SLP Money Market Fund, P293 million down roughly 44 percent P520 million.

Pama explained that the dramatic expansion of the Dollar Abundance Fund was a clear reflection of the market’s maturity.

The Dollar Abundance Fund is a dollar-denominated bond fund, as opposed to the Dollar Advantage Fund, which is a balanced fund (it has an equity component).

“Given the slow recovery in the developed markets, investors gravitated to the Dollar Abundance Fund due to its relative safety and higher growth potential,” the Slamci chief executive pointed out.

Meanwhile, Sun Life Financial and Malaysian state investor Khazanah Nasional has reportedly acquired a joint venture insurance company of UK insurer Aviva (AV) and Singapore listed CIMB Group for 1.7 billion ringgit ($563 million). Sun Life Financial of Canada is the principal of Sunlife Financial Philippines.

In a press statement, Sun Life Financial said that its operating net income was $1.2 million in the first nine months of 2012, compared to $325 million for the same period in 2011.

 â€œNet income for the first nine months of 2012 was positively impacted by improving equity markets, favorable investment activity on insurance contract liabilities due to investment in higher yielding and longer dated debt securities, net realized gains on sales of available-for-sale assets and favorable swap spread movements. These items were partially offset by the unfavorable impact of declining interest rates, which resulted in lower fixed income reinvestment rates in insurance contract liabilities, and negative impact from credit spread movements,” it said.