Value of Irish-based investment funds up €65.7bn

THE combined value of international investment funds domiciled in Ireland shot up by €65.7 billion in the last three months of 2010, according to new data from the Central Bank.

The overall value of Irish- resident funds (taking in equities, bonds and hedge funds) went from €539.8bn to €605.5bn between the end of the third and fourth quarters of 2010.

Nearly three quarters of Irish resident investment funds’ assets under management were invested in products that are resident in locations outside of the eurozone; although the information is no more specific than that.

In all, however, Irish- based funds held 53% of their assets under management in shares and other equities, by the end of last year.

“Over the past few quarters, substantial inflows into bonds held by investment funds were driving the increase in the value of investment funds,” according to the Central Bank’s latest commentary.

“In the fourth quarter of 2010, however, the value of both bond and equities held rose. While bond increases were driven by inflows into — or purchases of — bonds, the increases in equities was mainly driven by valuation effects as stock markets rebounded,” it said.

In terms of breakdown, nearly half of the increase in investment fund shares in issue — over the fourth quarter — was due to an increase in equity funds. Bond fund shares, meanwhile, increased by over €20bn over the quarter; while over the entire year, hedge funds domiciled in Ireland accounted for 52% of total hedge fund shares in issue in the eurozone.

Ireland actually accounted for nearly one third of the increase in investment fund shares in issue in the eurozone (only Luxembourg accounted for more) during the final quarter of the year.