Financial overview of Investment Funds – France 2020Q4
Published on the 8th of March 2021
Money market funds attract large inflows in 2020 and resilience of non-money market funds
- Money market funds post exceptional inflows in 2020 (+80 billion, see G1), i.e. an increase of 26%. After significant withdrawals of around 50 billion in March, money market funds quickly return to high positive net subscriptions for the rest of the year (see focus C), despite a negative annual net performance of -0.42%. These movements are explained by the strong growth in loans to non-financial companies generating cash invested in mutual funds and the wait-and-see attitude of investors to invest towards other supports. In the euro zone, outstanding amounts of money market funds (Focus E) stands at 1,416 billion, up 15% year-on-year, with French money market funds accounting for 28% of the total of 393 billion (unconsolidated data).
Investors in French money market funds are mainly residents (+62 billion). The structure of investments change significantly in favor of liquid assets: deposits and other net investments increase sharply (+52 billion) and a reallocation has been made between debt securities with original maturities of more than one year (-18 billion) and short-term securities (+42 billion). In addition, funds increase the relative share of sovereign securities. 24 billion were invested in them over this period and they represent 11% of securities investments at the end of 2020 (compared to 2% one year earlier). - Non-monetary funds record net subscriptions of 5 billion in 2020 (see table p.2), mainly from employee savings funds (+7 billion), bond funds (+5 billion) and real estate funds (+5 billion), while mixed funds record an outflow (-13 billion) (see G1). Inflows to non-monetary funds were relatively unaffected by the crisis. Their valuation fell sharply, but this was more than made up for over the year, particularly in Q4 (see focus C). With a 1% growth in outstanding, French non-money market funds nevertheless appear to be slightly down compared to the euro zone, where outstanding stands at 13,718 billion at the end of 2020 (Focus D), i.e. +6% year-on-year thanks to positive net inflows and favorable valuation effects.
Households are the main source of investments in French mutual funds (+13 billion). On the contrary, resident and euro zone MFIs are withdrawing (-8 and -13 billion respectively). On fund assets, debt securities decrease (-10 billion) in favor of equities and real estate assets (+14 billion).
G1. Net subscriptions by type of funds (cumulative flows over 4 quarters - Billion €) ![]()
A - Equity funds
B - Bond funds
C - Mixed funds
D - Real estate funds
E - Employees' Savings funds
F - Money Market Funds
Investment funds assets and investors![]()
(EUR billion)
| Assets | Net flows (a) | Stocks Part (%) | Investors | Net flows (a) | Stocks Part (%) | |||||
| Q4 2020 | 4 moving quarters | Q4 2020 | Q4 2020 | Q4 2020(g) | 4 moving quarters | Q4 2020 | Q4 2020 | |||
| Non money market funds | Total | 6 | 5 | 1,336 | 100% | Total | 6 | 5 | 1,336 | 100 |
| by type of instrument | Debt securities up to 1 year | 0 | -5 | 22 | 2% | Resident | 8 | 16 | 1,211 | 91% |
| Debt securities over 1 year | -1 | -5 | 372 | 28% | Insurance corporations | 7 | 2 | 516 | 39% | |
| Equity | 5 | 7 | 497 | 37% | Households and NPSH | 6 | 13 | 280 | 21% | |
| Investment fund shares | 2 | 3 | 329 | 25% | Non money market funds | 0 | 2 | 152 | 11% | |
| Real estate assets | 2 | 7 | 90 | 7% | ||||||
| Net deposits and loans and other assets (b) | -4 | -2 | 26 | 2% | General Government | 6 | 6 | 158 | 12% | |
| by geographical area (c) | Resident | 5 | 7 | 596 | 49% | MFIs | -11 | -8 | 45 | 3% |
| Non-Resident euro area | -3 | -11 | 401 | 33% | Non-Financial corporations | 1 | 0 | 52 | 4% | |
| Non-Euro area | 5 | 4 | 223 | 18% | Other financial institutions | -1 | 1 | 9 | 1% | |
| by issuer (c) | Non-Financial corporations and others (d) | 5 | 3 | 602 | 49% | Non-Resident euro area | -2 | -13 | 102 | 8% |
| MFIs | 1 | -2 | 159 | 13% | MFIs | -2 | -13 | 88 | 7% | |
| General Government | -2 | -4 | 106 | 9% | Non MFIs | 0 | 0 | 14 | 1% | |
| Others (e) | 3 | 3 | 352 | 29% | Non-Euro area | 0 | 2 | 23 | 2% | |
| of which non money market funds | 2 | 0 | 259 | 21% |
| Assets | Net flows (a) | Stocks Part (%) | Investors | Net flows (a) | Stocks Part (%) | |||||
| Q4 2020 | 4 moving quarters | Q4 2020 | Q4 2020 | Q4 2020(g) | 4 moving quarters | Q4 2020 | Q4 2020 | |||
| Money Market Funds (f) | Total | 26 | 76 | 373 | 100% | Total | 26 | 76 | 373 | 100% |
| by type of instrument | Debt securities up to 1 year | 20 | 42 | 217 | 58% | Resident | 18 | 62 | 297 | 80% |
| Debt securities over 1 year | 3 | -18 | 65 | 17% | Insurance corporations | -2 | 7 | 98 | 26% | |
| Investment fund shares | 0 | 0 | 1 | 0% | Non-Financial corporations | 9 | 32 | 88 | 24% | |
| Net deposits and loans and other assets (b) | 4 | 52 | 90 | 24% | Non money market funds | 0 | 4 | 67 | 18% | |
| by geographical area (c) | Resident | 10 | 14 | 129 | 46% | Households and NPSH | -1 | 0 | 5 | 1% |
| Non-Resident euro area | 3 | -2 | 88 | 31% | General Government | 4 | 5 | 16 | 4% | |
| Non-Euro area | 9 | 12 | 66 | 23% | Credit Institutions | -2 | 2 | 5 | 1% | |
| by issuer (c) | MFIs | 9 | 2 | 171 | 60% | Other financial institutions | 10 | 12 | 18 | 5% |
| Non-Financial corporations and others (d) | 5 | 1 | 62 | 22% | Non-Resident euro area | 4 | 7 | 62 | 17% | |
| Others (e) | -1 | -3 | 21 | 7% | MFIs | 5 | 5 | 54 | 15% | |
| General Government | 9 | 24 | 30 | 11% | Non MFIs | -1 | 2 | 8 | 2% | |
| Non-Euro area | 4 | 7 | 14 | 4% |
Note: As from this publication, real estate funds are integrated in data; Rounding differences mean that an aggregate may not be exactly equal to the sum of its components.
Source: Banque de France
(a) Variation of outstanding amounts for Money Market Funds
(b) net loans and net other assets include financial derivatives, non- financial assets and other receivables, net of other liabilities
(c) excluding loans and other net assets ; only securities portfolio
(d) Others added to Non-Financial Corporations include others Financial Institutions of the rest of the world (non MFIs as Insurance Corporations)
(e) Others : Non Money Market funds, Insurance and other Financial Institutions
(f) Consolidated Data: consolidated outstanding of money market fund shares or units do not include the resident securities held by money market funds themselves
(g) Quarterly holdings data are provisional and will be revised next quarter
(b) net loans and net other assets include financial derivatives, non- financial assets and other receivables, net of other liabilities
(c) excluding loans and other net assets ; only securities portfolio
(d) Others added to Non-Financial Corporations include others Financial Institutions of the rest of the world (non MFIs as Insurance Corporations)
(e) Others : Non Money Market funds, Insurance and other Financial Institutions
(f) Consolidated Data: consolidated outstanding of money market fund shares or units do not include the resident securities held by money market funds themselves
(g) Quarterly holdings data are provisional and will be revised next quarter
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Updated on the 8th of March 2021