Alternative investment funds grew by 8% last year

2024-03-20 08:10:00, Ekonomi CNA

Alternative investment funds grew for the second year in a row in 2023.

According to data from the Financial Supervisory Authority (AMF), at the end of last year, the total assets of alternative investment funds reached almost five billion ALL, an increase of 8% compared to the previous year. However, their weight against the total assets of investment funds in the country has remained at levels close to 2022, with about 10% of the total market.

The new law "On collective investment enterprises", which entered into force in June 2020, created the legal basis for alternative investment funds, funds where only professional and qualified investors can invest. According to the law, professional clients are classified as entities licensed to operate in the financial markets, such as banks, investment firms, insurance companies, collective investment enterprises, voluntary pension funds and the management companies of these enterprises, etc.

Also, large enterprises that fulfill at least two of the criteria, having total assets of at least 2.6 billion ALL, net turnover of at least 5.2 billion ALL and own capital of at least 260 million ALL, are recognized as professional investors.

Professional investors are also defined as central and regional government units, public bodies that administer public debt, central banks, international institutions, such as the World Bank, the International Monetary Fund, the European Central Bank, the European Investment Bank and other similar international organizations.

Alternative investment funds can take the form of closed joint ventures with the form of a commercial company or contractual form (investment funds) which are suitable for making illiquid investments, such as real estate.

Currently, two alternative investment funds are licensed in Albania, Sea Land Investment Fund and Green View Alternative Investment Fund. Both funds are managed by the management company Credins Invest. The assets of these funds are mainly invested in real estate.

At the end of 2023, the largest fund, the Sea Land Investment Fund, had total assets of approximately ALL 3 billion, an increase of 8.4% compared to the previous year. While the other fund, Green View Alternative Investment Fund, owned total assets for more than ALL 1.9 billion, increasing by 7.5% compared to 2022.

The increase in the value of properties, located near the area where the Vlora Airport is being built, has had a positive effect on the total assets of these funds.

Meanwhile, the most important segment of the market of investment funds, that of classic funds that invest in financial instruments, last year returned to growth, after the strong blow it suffered in 2022. According to AMF statistics, net assets of these funds (excluding alternative investment funds) reached the value of ALL 45.45 billion, an increase of 9.2% compared to 2022. The number of members in the funds reached 32 189, an increase of 11.2% compared to the end of 2022./ Monitor .co.uk