Business News - Monday December 17, 2007
Thanachart foresees major boost in fund assets next year
Thanachart Fund Management plans to increase assets under management to 120 billion baht next year, from 81 billion baht expected at the end of this year.
Managing director Boonchai Kiattanavith said the implementation of the Deposit Insurance Act would be a big boost for the overall mutual fund industry next year.
''In my opinion, depositors will think of shifting their savings to invest in mutual fund products when the new law takes effect sometime next year. But the shift of funds will come gradually, I think, rather than in a big flood as many people believe,'' he said.
Next year, money market and short-term bond funds are expected to remain attractive and to expand substantially.
Mr Boonchai said the company was working on detailed plans in 2008 with a number of new funds including one money-market fund with a short bond duration of six months and at least five foreign investment funds.
This year, assets under management at Thanachart Fund have risen by 69% from 48 billion to 81 billion baht, driven by money market and short-term bond funds and FIFs.
The company outperformed the mutual fund industry, which saw total assets excluding Vayupak Fund rise more than 20% to 1.23 trillion baht as of Nov 30 from 1 trillion baht at the end of last year.
Thanachart Fund positions itself as a pioneer in introducing new fund features from international financial institutions. Its four FIFs have assets of 5.6 billion baht, up from one billion baht early this year.
Its T-Cash money market fund has seen assets grow to 25 billion baht from 2.5 billion baht earlier this year. T-Cash allows investors who sell units to receive the funds one day after the transaction is made, or T+1.
The T-Cash fund has generated returns of around 2.8-2.9% compared to a 3.6% yield on one-year government bonds.
''Investors should be careful when investing in any fund product as the debt and equity markets will be more volatile next year due to the pressure from the lingering US sub-prime problems,'' he said.