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Irish domiciled assets reach record EUR4 trillion with 42.1 per cent growth in ETF assets

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Irish Funds has announced at its 23rd Annual Global Funds Conference in Dublin that assets domiciled in Irish funds surpassed EUR4 trillion at the end of 2021, for the first time ever, representing 22.5 per cent year-on-year growth, with a 42.1 per cent growth solely in ETFs. 

This growth has been accompanied by a significant increase in the number and breadth of firms operating in Ireland, a key EU hub, the association says.

 

The association writes that Ireland is home to 6 per cent of worldwide investment fund assets, and to almost 19 per cent of European fund assets, making it the third largest centre in the world. The total number of Irish domiciled funds, including sub-funds, reached 8,450 in March 2022. 

These funds are helping pension funds and other long-term savers from across the EU and beyond to secure their financial futures, the association says.

The conference theme, Resilience, Emergence and Growth, focuses on the opportunities and challenges facing the funds and asset management industry as the world emerges from the pandemic, with a number of panel discussions covering the rise of private assets, leveraging fintech in asset management distribution, the evolution of the modern workplace in light of the move to hybrid formats and crypto assets, which have gained significant interest among investors.

The discussion on crypto assets coincides the launch of the Irish Funds White Paper titled – Crypto Assets: opportunities, risks and future possibilities for regulated investment funds in Ireland, which includes an action plan to ensure Ireland utilises its current strengths as both a leading investment funds centre and a significant technology hub to take advantage of the opportunities presented by crypto assets. The action plan sets out the following priorities:

 

Regulatory clarity – on the extent and nature of exposure for funds used by institutional investors which would be appropriate, as well as a commitment to consider the conditions and circumstances under which sophisticated retail investors might avail of access.

EU Convergence – urging engagement between the CBI, peer regulators, the European Supervisory Authorities (ESAS) and the European Forum of Innovation Facilitators to ensure a convergence of approaches towards crypto assets.

Government backing – building on the creation of the Fintech Steering Group, to create a specific task force on tokenisation to support the creation and operation of tokenised platforms within Ireland.

This follows the Central Bank of Ireland’s advice to Irish Funds in March 2022 that it has approved in principle the first ever low level of exposure, to cash settled bitcoin futures traded on the CME, for a fund for qualified investors.

 

Maria Ging, Irish Funds Chairperson opened the Conference stating: “Never has the purpose of this industry to support global savings and all of our stakeholders across society, local communities and employees been more relevant or more important as we move from resilience, through emergence to growth.”

 

In the second keynote address, the Governor of the Central Bank of Ireland, Gabriel Makhlouf, said: “Market‑based finance, including asset management, provides a valuable alternative to bank financing. It can facilitate risk sharing across the financial system and support economic activity.”

 

Irish Funds Chief Executive, Pat Lardner added: “The funds and asset management industry in Ireland has proven its resilience throughout the pandemic and is making a tangible and increasing contribution to the economy at all levels – locally, regionally and nationally. 

 

“Ireland’s funds and asset management industry is a world leader in a highly competitive, global industry which is answering the call to assist in addressing the challenges of today, whether that be in relation to climate or post pandemic recovery.

 

“We are also firmly focused on the future in terms of the tools and skills we need to maintain and build upon a reputation for trust, capability and innovation to support the next generation of savers.”

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