6.2% growth: Irish Fund Industry continues to flourish
New findings from the 25th edition of Monterey Insight Ireland Fund Report, the independent fund research company, reveal the market shares of all service providers in Ireland’s funds industry.
Fund assets serviced in Ireland rose by 6.2% reaching US$3,903.4bn at the end of June 2019, up from US$3,677.1bn in 2018. The total number of sub-funds reached 9,249 (an increase from the 8,982 of the previous year). Looking at Irish domiciled funds only, the number of funds and sub-funds has grown by 7.2% to 5,607 (from 5,229 in 2018) reaching a market size of US$3,001.1bn, an increase of 5.4% of total fund assets.
The amount of new Irish schemes launched during the year rose to US$27.3bn with in excess of 200 sub-funds (this does not include new sub-funds launched within existing umbrellas). Altogether, 859 Irish groups and sub-funds were launched during the year representing total assets of US$117.8bn.
State Street continue to be the largest player for administration, custody and transfer agency services increasing their assets for each role: assets under administration US$1,313.4bn, custody US$1,186.3bn and transfer agency US$1,109.0bn.
Tadhg Young, Head of State Street Ireland, commented:
“We’re very proud that we continue to be the market leader for fund administration, custody and transfer agency services increasing our assets in every category. Our broad client mix, including some of the world’s largest and most successful asset managers helps to inform our deep understanding of their needs, and allows us to fully support them as they grow their businesses in new markets, develop more complex products, and expand into a greater number of geographies.”
In more detail, for fund administration services across both domiciled and non-domiciled funds, State Street Fund Services (US$1,313.4bn) is followed in second place by BNY Mellon (US$510.4bn), Northern Trust (US$509.3bn) in third and JP Morgan in fourth position with US$345.1bn.
Among custodians of serviced funds, the ranking remains unchanged with State Street Custodial Services having the largest assets under custody (US$1,186.3bn), ahead of The Bank of New York Mellon SA/NV, Dublin Branch (US$497.8bn) and Northern Trust (US$495.6bn) in third place.
In the transfer agents ranking of serviced funds, State Street Fund Services secure first position with total net assets of (US$1,109.0bn) followed by Northern Trust (US$510.9bn) in second position and BNY Mellon (US$389.6bn) in third.
Again, for serviced funds, among Ireland’s professional audit firms, as has been the case for a number of years, PwC hold the lead position in auditor’s rankings in both number of funds and assets auditing a total of 2,440 funds with US$1,300.3bn in assets. They are followed by KPMG with 1,837 funds (US$729.7bn) and Deloitte rise to third position with 1,452 funds (US$716.7bn).
Trish Johnston, PwC Ireland Asset & Wealth Management Leader, said:
"I am delighted that PwC continues to be the number one auditor to the asset and wealth management industry in Ireland. Ireland has one of the world’s largest funds servicing industries. With a highly skilled workforce and a pro-business economy, Ireland remains a very attractive location for fund domiciliation and servicing. In the last year, a significant number of asset managers have picked Ireland as their location of choice for an EU base, and we expect this to continue as the next phase of Brexit develops. Despite ongoing global uncertainty in 2020, we continue to see significant growth opportunities for the Asset and Wealth Management industry, both in Ireland and abroad. While asset managers continue to face pressure on fees and must achieve greater operational efficiency, growing levels of global wealth and a shift towards sustainable investment are driving demand for Environmental, Social & Governance focused products and innovative investment solutions."
Among legal firms, as in previous years for Irish domiciled funds, Dillon Eustace secure the top position with 1,185 funds ahead of Matheson keeping the second spot with 1,178 funds.
Donnacha O’Connor, Head of Asset Management and Investment Funds in Dillon Eustace commented:
“We are delighted to continue to be the leading advisers to Irish domiciled investment funds. The Irish funds industry enjoyed significant growth again last year, not only in the number and value of investment funds established and serviced here, but also in the number of fund management companies who chose to set up Irish operations. With so much change happening in the market and with so many opportunities and challenges ahead, it is an exciting time to be part of the industry.”
Maples Group remain the largest legal adviser on the volume of funds serviced in Ireland providing legal advice to 1,497 funds, followed in second place by Dillon Eustace with 1,284 funds.
Peter Stapleton, partner and Head of the Funds & Investment Management team in the Maples Group’s Dublin office commented on the results:
"We are delighted to be ranked as the top legal adviser on Irish-serviced funds for the seventh consecutive year. 2019 was a challenging year for fund formations with Brexit and other macro factors causing considerable market volatility and uncertainty, so it is quite remarkable that the number of funds we advised on continued to grow significantly against that backdrop".
He continued: "In addition to this, I am incredibly proud that we have emerged as the clear market leader on fund product innovation advising on almost 30% of all new Irish domiciled sub-funds in 2019. This simply would not have been possible if it weren't for the very talented team of lawyers at the Maples Group and of course all of our clients which we feel very privileged to work alongside."
For the market share ranking of legal advisers by assets, Matheson continue to rank first for Irish domiciled funds with US$921.5bn followed by Dillon Eustace with US$578.7bn and William Fry with US$460.6bn. Amongst both domiciled and non-domiciled funds, Matheson and Dillon Eustace are also first and second respectively with US$926.9bn and US$587.0bn, however Maples Group take third position with US$536.6bn.
Tara Doyle, Head of Matheson’s Asset Management and Investment Funds team, said:
“We are delighted to see our market share, both in terms of assets and number of funds, continue to grow. This is testament to our clients’ commitment to Ireland as a fund domicile and to our team centred approach to client servicing. We are proud of the part we play in our clients’ continued growth.”
Among the largest fund promoters/initiators of Irish domiciled schemes, the top three positions remain the same as last year: BlackRock Financial Management keep their lead and increase their total net assets to US$637.4bn, followed by PIMCO with US$198.9bn and Vanguard Group in third position with US$144.5bn.
The top three positions for Management Company/AIFM, among Irish schemes, including Irish UCITS and Irish Non-UCITS, results in the same figures as for promoters/initiators above.
Similar to previous years, money market funds remain the largest asset class although they have decreased by 1.5% to US$579.6bn, followed by bond & equity products: bonds were up by 6.1% to US$549.2bn and equities up by 9.0% to US$539.4bn.
Karine Pacary, Managing Director at Monterey Insight commented:
"The latest Monterey Insight Ireland Fund Report illustrates the continued impressive growth of the Irish funds industry which has now, for the first time, passed the USD 3trillion mark by domiciled market assets, a growth of 6.2% from the previous year. A large proportion of this increase can be clearly identified with the continuing success of the ICAV structure. It records assets of USD239bn out of a total of 1,236 funds and sub-funds. From the 859 new sub-funds launched during the year, ICAVs represent a significant 45% and almost a third of the new inflow of assets.
Another product type experiencing a growth in popularity was the CCF. Their total assets amount to USD106bn (up from USD79bn) from only 132 products and represents nearly 14% of assets of all newly launched funds.
Overall, the Irish funds market maintains its position as one of the most attractive and well established financial centres for the servicing of a multitude of investment products."
For more information, please contact:
Karine Pacary, Managing Director, Monterey Insight, Tel. +44 (0)845 625 3863
Notes to Editors
Monterey Insight is an independent fund research company that provides comprehensive statistical analysis of the Ireland, Luxembourg, Guernsey, Jersey and UK fund industries: the only complete reference of service providers for all funds serviced in these jurisdictions.
As at 30th June 2019, leading service providers for all funds serviced in Ireland (i.e. including non-domiciled funds under administration or custody in Ireland, with the exception of ManCo/AIFM and one ranking table for legal advisers which contained Irish domiciled funds only) were as follows:
Source: Monterey Insight Ireland Fund Report.