Charting the dynamics of Slovakia’s asset management industry
The major players in this market include Erste Asset Management, Tatra Asset Management sprav. spol., a.s., Eurizon Asset Management, and 365 Invest.
Erste Asset Management, asset manager of the largest Slovak bank, has emerged as a dominant force in recent years, focusing on the sales of mutual funds and dynamic funds, demonstrating extraordinary net sales and sales of new savings plans.
Eurizon Asset Management, asset manager of the second largest Slovak bank, has also experienced notable sales growth, specifically in dynamic funds.
365 Invest, one of the oldest asset managers in Slovakia, originally known as Prvá penzijná until 2021, places its main focus on real estate investments.
The industry is primarily influenced by asset management companies associated with the three largest banks in Slovakia, namely Slovenská sporiteľňa (Erste group), VÚB (Eurizon group), and Tatra banka.
Tatra Asset Management, a leader in assets under management for 25 years, was overtaken by Erste Asset Management by the end of 2023. Erste Asset Management has notably dominated the market in recent years, with a significant volume of net sales and a surge in new saving plans.
Eurizon Asset Management stands as a key competitor, registering substantial net sales over the past three years, while 365 Invest has recorded a significant total volume of net sales in the last three years.
In terms of fund prevalence, 74% of Slovak funds are UCITS*, with the remaining 26% being non-UCITS*.
The top three fund categories, including mixed funds (33%), equity funds (32%), and real estate funds (20%), collectively account for 85% of the total assets under management. While one-off investments have historically dominated the market, there has been a notable shift in focus towards investment savings plans in the last five to seven years, resulting in an impressive total of over 1,000,000 savings plans held by Slovak investors.
Strong fintech presence
Tatra Asset Management has historically been a leader in introducing new products and ideas within the market. In the last three calendar years and nine months of 2024 Tatra Asset Management has recorded net sales of 278 million euro and 190,000 new savings plans. Additionally, the industry has witnessed the emergence of a strong fintech presence, particularly with the presence of digital robo-advisors. One notable example is Finax, which manages 0.9 billion euro in assets under management and offers portfolios composed of ETFs (Exchange Traded Funds). Known for its assertive communication style and competitive positioning, Finax emphasizes cost-effectiveness and tax benefits for its products, despite having a management fee of 1.2%. This stands in contrast to traditional Slovak mutual funds.
In summary, Slovakia’s asset management industry has seen substantial growth and evolution over the years, marked by shifting investor preferences, the rise of digital robo advisors, and the continued dominance of major players such as Erste Asset Management, Tatra Asset Management and Eurizon Asset Management.
Supplementary Pension Saving
The number of new clients in DDS TB Slovakia (Doplnková dôchodková spoločnosť Tatra banky, a.s.) has been growing significantly in recent years.
The Supplementary Pension Company of Tatra banka (DDS TB Slovakia) was established in January 1998. It is a subsidiary of Tatra banka and part of the Raiffeisen International Group. Supplementary pension saving, or the third pillar, is a voluntary form of financial security for retirement. Together with the state pension (first pillar) and old-age pension saving (second pillar), they have formed the basis of the pension system in Slovakia since 2004.
Savings in the third pillar are voluntary in Slovakia, and employers can also contribute to the employee’s pension. We currently have more than 320,000 clients and 1.28 billion euro in assets under management (AUM). The total amount of AUM in the Slovak third pillar reached 4 billion euro.
DDS TB Slovakia is the second-largest company in the supplementary pension savings sector by number of clients (31%) and by AUM (33%). The leader in the sector is NN Tatry – Sympatia, d.d.s., with a market share of 40% in AUM.
DDS TB Slovakia sells retirement savings through three main distribution channels:
Tatra banka (61%),
Raiffeisen banka (21%),
and DDS Tatra banky sales channels (19%).
In recent years, DDS TB Slovakia has also developed digital sales, primarily through a mobile application of Tatra banka, which currently accounts for approximately 10% of all Tatra banka sales.
Regarding fund management, we manage pension funds according to specialized local laws regulating supplementary pension savings, and therefore DDS TB Slovakia funds do not fall under the UCITS/non-UCITS category. Pension savings are based on long-term, regular savings with the possibility of obtaining an employer’s contribution. At DDS TB Slovakia, we have the highest average contributions on the market, with an average saver contribution of 32 euro and an average employer contribution of 50 euro.
DDS TB Slovakia, as the only supplementary pension saving company in Slovakia, uses a unique personalized investment strategy called Comfort life. Our target date funds adapt and change according to the age of our clients. From the first to the last contribution, you can save in a single fund throughout the entire saving period.
Regarding the fintech impact on the market, we currently do not see any significant influence of specialized fintech companies in voluntary retirement savings.
* UCITS: The Undertakings for the Collective Investment in Transferable Securities (UCITS) is the European Commission's regulatory framework for managing and selling mutual funds. UCITS funds can be registered and sold in any country in the European Union using unified regulatory and investor protection requirements.
Source: Tatra banka a.s., as of September 2024