October 2023 Monthly Report

PENSION FUNDS

SECOND PILLAR PENSION FUNDS

At the end of October 2023, mandatory pension funds (MPFs) had 2,235,079 members, i.e. 4,972 (0.22%) members more than in the previous month. Category B funds had 82.0% of all MPF members, while category A and category C funds had 13.5% and 4.5% of all MPF members respectively. Out of 7,512 new members, 7,138 (95.0%) were automatically allocated by Regos. Termination of membership due to retirement or death was recorded with respect to 2,540 insured persons. Total net contributions paid to MPFs in October amounted to EUR 109.6m (0.6% of net assets at the end of September). At the same time, total payments from all MPFs due to personal account closures reached EUR 43.3m (0.2% of net assets at the end of September), increasing by EUR 20.0m compared to the previous month.

At the end of October 2023, net assets of MPFs amounted to EUR 19.3bn, declining by EUR 59.9m (0.3%) relative to the previous month. Nominal monthly Mirex returns reached -1.4% for category A, -0.7% for category B and 0.2% for category C. Annual Mirex returns reached 10.5% for category A, 5.9% for category B and 2.0% for category C, while annualised[1] returns since the beginning of MPFs’ operation stood at 6.7% for Mirex A, 5.1% for Mirex B and 3.1% for Mirex C[2].

At the end of October, bond investments of MPFs totalled EUR 12.4bn (64.3% of total assets), making their share increase by 1.7 p.p. on a monthly basis. The share of equity investments in MPFs’ assets decreased by 0.4 p.p. on a monthly basis, amounting to 21.7% of MPFs’ assets (EUR 4.2bn). Investments in domestic shares accounted for 13.4%, while investments in foreign shares accounted for 8.3% of MPFs’ assets. Investments in investment funds amounted to EUR 2.1bn (10.7% of the assets), making the proportion of these investments in total assets fall by 0.5 p.p. relative to the previous month. Investments in cash and deposits amounted to 2.8% of the assets, or EUR 542.7m.

THIRD PILLAR PENSION FUNDS

At the end of October 2023, the number of members of 8 open-ended voluntary pension funds (OVPFs) rose by 0.4% on a monthly basis, while the number of members of 21 closed-ended voluntary pension funds (CVPFs) increased by 0.1%, making the number of members of these funds reach 388,843 and 47,995 respectively. Total monthly payments made to voluntary pension funds (VPFs) in October 2023 amounted to EUR 8.9m (0.8% of their net assets at end-September 2023), decreasing by 0.5% compared to the previous month. Total payments made from these funds reached EUR 3.9m, increasing by EUR 0.2m (4.9%) compared to total payments made from VPFs in the previous month. Total payments from VPFs made due to retirement and other reasons accounted for 67.8%, payments made due to the change of fund reached 28.9%, while those made due to death accounted for 3.3% of total payments in October. With respect to payments made due to retirement, the amount of EUR 1.2m was paid through a pension company (fund), the amount of EUR 0.8m was paid in the form of lump-sum payments, while the amount of EUR 0.8m was transferred for payment to pension insurance companies.

In October 2023, net assets of VPFs decreased by EUR 5.6m (0.5% on a monthly basis) and stood at EUR 1.16bn. Monthly nominal returns of VPFs ranged from -1.5% to 0.1%, while returns on an annual basis ranged from 0.4% to 12.0%. As regards the investment structure of VPFs, the largest part of the portfolio was made up of bonds and amounted to a 55.1% share in total net assets, followed by stocks with a 25.7% share and investment funds with a 11.5% share. The share of bonds in VPFs’ investments increased on a monthly basis by 0.9 p.p., the equity share fell by 0.4 p.p., while the share of investments in investment funds declined by 0.9 p.p.

INSURANCE COMPANIES

In October 2023, there were 14 insurance companies operating on the market. Their total premium collected in the first ten months of 2023 amounted to EUR 1.4bn, of which EUR 243.8m (17.0%) related to life insurance premium and EUR 1.2bn (83.0%) to non-life insurance premium. The structure of the collected non-life insurance premium is dominated by motor vehicle liability insurance (35.7%), followed by insurance of land vehicles (18.0%) and insurance against fire and natural disasters (9.2%). The amount of claims settled in the first eight months of 2023 reached EUR 925.0m. EUR 345.8m of this amount related to life insurance (37.4%), while EUR 579.2m related to non-life insurance (62.6%). Within the total amount of claims settled in non-life insurance, the largest amounts related to motor vehicle liability insurance (39.3%), insurance of land vehicles (20.6%), and insurance against fire and natural disasters (9.7%).

CAPITAL MARKET

In October 2023, the total turnover on the Zagreb Stock Exchange reached EUR 25.6m, decreasing by 47.2% on a monthly basis. Market capitalisation increased by 0.1% relative to the previous month and stood at EUR 39.1bn, of which stocks amounted to EUR 21.3bn, bonds to EUR 17.8bn and ETFs to 16m. As for stock indices, the smallest monthly decline was recorded by CROBEXkostrukt (0.1%), while CROBEXturist recorded the largest monthly decrease (6.95%). The main ZSE stock index (CROBEX) also declined, as did CROBEXtr (both by 2.7%). The main bond index CROBIS declined by 0.2%, while CROBIStr increased by 0.01%. PODRAVKA d.d. was the stock most traded in October, with its turnover amounting to EUR 3.0m (16.6% of the overall trade in stocks in October) and an 8.2% monthly price decrease.

INVESTMENT FIRMS

At the end of the third quarter of 2023, there were 23 legal entities authorised to provide investment services, namely 5 investment firms, 12 credit institutions and 6 investment fund management companies. The third quarter of 2023 saw a quarterly increase of the value of assets managed by investment fund management companies (a 3.8% rise), and investment firms (a 3.2% rise), while assets managed by credit institutions recorded a quarterly decrease of 1.2%. Assets under the custody of credit institutions grew by 18.3% compared to the previous quarter, while assets under the custody of investment firms increased by 66.9%. The third quarter of 2023 saw the distribution of financial instruments in the amount of EUR 179.7m (a quarterly 25.3% decline compared to the previous quarter), 86.6% of which was accounted for by units of domestic UCITS, 10.0% by units of foreign UCITS, and the remaining 3.4% by foreign certificates and other foreign financial instruments.

INVESTMENT FUNDS

In October 2023, there were 111 UCITS operating on the market, four more than in the previous month. Their total net assets amounted to EUR 2.1bn at the end of the month, increasing by EUR 39.6m or 1.9% compared to the previous month. Total monthly net payments of all UCITS in October were positive and reached EUR 47.0m. Negative net payments were recorded by balanced funds (EUR -6.8m), equity funds (EUR -4.5m) and feeder funds (EUR -2.6m). Positive net payments were recorded by funds belonging to the “other” category (EUR 59.1m), cash funds (EUR 1.2m) and bond funds (EUR 0.6m). Bond funds’ net assets accounted for 39.7% of the total net assets of all UCITS at the end of October, while equity and balanced funds accounted for 15.7% and 12.5% of the total net assets of UCITS respectively. In October 2023, positive asset-weighted average monthly returns were generated only by bond (0.2%), and other (0.002%) UCITS. Negative average monthly returns were recorded by feeder (-2.1%), equity (-1.6%) and balanced (-0.7%) funds.

The net assets of the Fund for Croatian Homeland War Veterans and Members of their Families amounted to EUR 142.4m (a 0.6% monthly increase), with the monthly return of the fund reaching 0.8%.

LEASING COMPANIES

At the end of the third quarter of 2023, the total assets of 15 leasing companies stood at EUR 3.5bn, an increase of 17.9% on an annual basis. The pre-tax profit recorded by leasing companies fell by EUR 3.1m (5.9%) compared to the same period last year, amounting to EUR 49.7m. The outstanding contract value of active contracts recorded an 28.8% annual increase in the operating lease segment, while its annual increase in the finance lease segment reached 18.0%. The value of newly concluded contracts in the operating lease segment rose in the first three quarters of 2023 by 62.8% relative to the same period last year, while this growth in the finance lease segment amounted to HRK 21.5%. This was mostly due to an increase in the value of contracts involving passenger cars (EUR 671.2m), commercial vehicles (EUR 250.0m) and plant, machinery and equipment (EUR 105.5m) as leased assets. The total value of newly concluded contracts in the first three quarters of 2023 increased by EUR 363.0m (28.8%) on an annual basis.

FACTORING COMPANIES

At the end of the third quarter of 2023, there were 3 factoring companies operating on the market. The total assets of factoring companies amounted to EUR 18.1m, while their income before tax reached EUR 0.6m. The transaction volume in the first three quarters of 2023 was still dominated by classic factoring totalling EUR 61.2m (86.7% of all transactions), as were receivables, with classic factoring amounting to EUR 9.4m (81.8% of all receivables) at the end of the third quarter of 2023.

The full report is available at Statistics/Monthly reports