UK top European investment management location

In its latest annual review, the European Fund and Asset Management Association (Efama) estimated that total assets under management (AuM) in Europe grew by 12% in 2012 to €15,400bn – the highest figure since 2006, and the highest ratio of AuM to gross domestic product over the same period, standing at 108%.

More detailed figures for AuM in individual European centres are only available up to the end of 2011, and position the UK as the top country for managing investments. Assets managed out of the UK’s financial centres were worth an aggregate €4977bn, accounting for more than one-third of Europe’s total. Second and third in the ranking are France and Germany, with €2756bn and €1438bn in AuM and 20% and 10% market share, respectively. Italy, the Netherlands and Belgium follow at a far distance.

Clear lead

If the UK is the prime investment management location – and hosts Europe’s leading financial centre, London – looking at where investment funds are domiciled generates a different picture. Thanks to its favourable regulatory environment, Luxembourg’s fund business has been overshadowing other regional financial centres for more than a decade. Investment funds domiciled in the country stood at €2384bn at the end of 2012, accounting for 27% of all such funds in Europe, and representing a 14% increase on 2011.

Data on the number of funds from Efama and the UK’s Investment Management Association (IMA) further highlight Luxembourg’s success, with about 13,000 funds domiciled in the country, compared with the 5000 or so domiciled in Ireland – a growing centre, ranking fourth in the European funds business table – and the less than 3000 domiciled in the UK, which ranks fifth in the table.

As concerns about the eurozone eased slightly during 2012, the volume of investment fund assets domiciled in the region experienced a surge in demand, which pushed funds to an all-time high of €8900bn, according to Efama. In particular, equity and fixed-income funds grew by 15% and 13%, respectively.

Second and third spot in the ranking by domiciled funds are occupied by France and Germany. Switzerland and Italy sit in sixth and seventh place, respectively, accounting for significantly smaller proportions of total European funds.

Sweden, Denmark and Spain make up the top 10 table, and are the only countries that have changed their positions in the ranking since 2011. While Spain’s decreased assets saw it slip two places to 10th, Sweden and Denmark both attracted larger volumes and climbed to eighth and ninth place, respectively.