Indonesian Asset Managers Aim for Double-Digit Growth in 2015

FEBRUARY 04, 2015

Jakarta. Asset management firms in Indonesia anticipate double-digit growth in assets under management this year as they plan to launch more mutual funds amid improving investor confidence on the back of higher economic growth.

BNI Asset Management, an arm of state lender Bank Negara Indonesia, aims to grow its managed funds by half this year, said the president director Reita Varianti.

The fund managers targets to manage up to Rp 15 trillion ($1.19 billion) of funds this year — or 51 percent higher than the Rp 9.9 trillion that it currently manages — from its new mutual fund products.

“A lot of our the products we plan to launch this year will be carry-overs from last year. There were a lot of issues that made investors choose to wait-and-see, such as the fuel subsidy price hike,” Reita said on Wednesday.

BNI Asset Management will be launching at least 10 new mutual fund products this year that’s expected to bolster the company’s growth, Reita said.

Isbono Putro, a director at BNI Asset Management, said that the firm plans to increase its distribution by tapping into 1,700 branches of its holding company BNI to attract more potential investors.

“We will also launch an online trading service in the second quarter this year. With all this, we’re optimistic that we can manage Rp 15 trillion of assets by 2015,” Isbono said.

The government targets the economy to grow by 5.7 percent this year, as the government gear up spending on infrastructure projects, up from an estimated 5 percent last year.

Other asset management firms in Indonesia also posted a relatively bullish outlook for the year include Panin Asset Management — an affiliate of privately owned Panin Bank — and Eastspring Investment Indonesia, the local investment arm of British life insurer Prudential.Panin Asset Management seeks to manage up to Rp 16 trillion of assets this year, up 31 percent from Rp 12.2 trillion in 2014.

Panin’s president director Winston Sual said that the country’s easing inflation rate, as well as the low price of oil globally, were set to bolster confidence in the market.

Indonesia’s consumer price index slowed to 6.96 percent in January from 8.39 percent in December last year, according to data from the Central Statistics Agency. Lower inflation is likely to spur household consumption, which accounts to 51 percent of Indonesia’s economy.

Eastspring Investments Indonesia’s president director Riki Frindos said on Tuesday that the firm is predicting an above-average growth this year as the country’s economic growth improves. Riki declined to say Eastspring Investments’s exact growth target.

Eastspring Investment Indonesia, one of the country’s largest fund managers, managed a total of Rp 51 trillion of funds last year, up 34 percent from Rp 38 trillion in 2013.

Indonesian Fund Managers Association (APRDI) had said last month that it expected the country total assets under management to grow by at least 20 percent this year.

Indonesia’s total mutual funds asset rose to Rp 266 trillion in 2014, up 21 percent from Rp 219 trillion in 2013, according to data from Financial Services Authority.

GlobeAsia & Investor Daily