Global economy impact on pension funds - Amundi-ACBA Asset Management Deputy Director

29.07.2020 15:40
Global economy impact on pension funds - Amundi-ACBA Asset Management Deputy Director

YEREVAN, July 29. /ARKA/. Deputy Director, Fund Manager of Amundi-ACBA Asset Management CJSC Hrayr Aslanyan has assessed the impact of the coronavirus pandemic on the world economy and Armenia's behavior in these conditions.

Aslanyan's article was provided by the press service of ACBA Credit Agricole Bank.

The coronavirus pandemic has created new problems and challenges for the global economy. The crisis has spread to almost all industries, creating all the prerequisites for a deep economic recession. Armenia also did not stay away from economic difficulties.

Due to the coronavirus pandemic, in the first half of 2020, the global economy was in an unprecedentedly deep crisis. According to the latest forecasts, the global economic decline in 2020 will be minus 4.3%.
In some countries, the decline may even reach double digits. Armenia, being part of the global economy, also reacted negatively.

Combining monetary and fiscal stimuli will help revitalize the global economy. However, as it was observed in the case of a pandemic cycle, economic recovery will occur in successive stages, that is, at different periods and at different rates.

After a deep decline in the first quarter of 2020, world financial markets started the second quarter in a positive environment due to an unprecedented volume of support from governments and central banks. As a result, risky assets, especially stocks, recovered quite quickly during the second quarter, even faster than expected.

The financial market of Armenia reacted positively. In particular, a certain decline was recorded in the first quarter of the year, while in the second quarter, things were put right - the exchange rate stabilized and bond prices went up.

All these factors contributed to the recovery of the profitability of pension funds managed by Amundi-ACBA, the average annual rate of which at the end of June 2020 ranged from 8.8 to 9.3% depending on the type of the fund.

The assets of pension funds managed by Amundi-ACBA grew about 10% or by 14 billion drams in the second quarter of this year alone, amounting to more than 149 billion drams by the end of June.

This growth is due to both social allocation of participants and positive profitability. In short, fund profitability has recovered almost entirely, but it is too early to assume that there will be no further recession as uncertainty caused by the coronavirus pandemic remains.

The likely second wave of the pandemic, as well as possible geopolitical risks and higher debt levels, are factors that could lead to greater volatility in the near future.

This crisis has once again confirmed the viability and flexibility of the fund management approaches applied by French Amundi and localized by Amundi-ACBA, which are based on the key principles of selectivity and diversification. So, diversification on countries and continents, currencies, asset classes, securities and issuers is implied.

More details can be found here

CJSC Amundy-ACBA Asset Management was founded by ACBA Credit Agricole Bank and French Amundi - the largest asset management company in Europe.
Amundi-ACBA Asset Management is one of two pension fund management companies operating in Armenia. It runs three mandatory pension savings funds - Stable Income, Conservative and Balanced.
The company is controlled by the RA Central Bank.
Former performance of funds is not a determining factor for current or future performance. - 0--

Tags: , , Новости Армении АМИ Новости-Армения

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