|Indexo, IPAS (875500AT8JI5HU41AY20)
|2.2. Iekšējā informācija
According to the consolidated, unaudited interim financial Report for the first half of 2023 of the pension management company IPAS Indexo (hereinafter – INDEXO) by the end of June 2023 the company has increased its client number by 38% year-on-year and grown its assets under management (AUM) by 56% year-on-year. By the end of the first six months of 2023, the INDEXO client number was 113 300 and the total AUM were EUR 754 million.
“On July 28, we joined the top three 2nd pillar pension management companies in Latvia, behind only large retail financial services groups SEB and Swedbank. We have achieved this without the sales channels available to retail banks. Barring a downturn in the equity markets, we are on track to reach 900 million in AUM by the end of the year. Index funds still account for only a fraction of the total 2nd pillar market, so we see a considerable opportunity for growth in the coming years,” says Valdis Siksnis, INDEXO Board Chairman and one of the founders of the company.
Over the last 12 months, Latvian overall 2nd pillar pension system AUM grew from EUR 5.44 billion to EUR 6.35 billion, or by 16.7%. INDEXO AUM in the 2nd pillar pension plans meanwhile grew by 54%, or about three times faster than the market, from EUR 478 million to 739 million. The biggest drivers of growth have been the transfer of funds by clients joining the company, followed by monthly contributions and the positive returns of the markets. INDEXO has reached 11.6% market share in 2nd pillar pension products at the end of the second quarter of 2023, up from 8.8% a year ago.
Over the past year, INDEXO convincingly was the fastest growing pension management company in Latvia in terms of new client acquisition with 26 314 new clients added, compared to only 6 344 new clients by the second closest competitor and 3 606 by the third closest competitor.
In addition to the pension management operations and the work on establishment a new commercial bank, INDEXO has also co-founded a real estate fund management company to create a low-cost real estate fund in the market. INDEXO pension plans “Jauda” and “Izaugsme” will over time invest 5% of the assets into local real estate.
In the reporting period, the INDEXO group’s commission income rose to EUR 1.39 million (compared to EUR 1.04 million in the corresponding reporting period in 2022). The growth in commission income reflects the successful acquisition of customers during the year and an increase in total AUM. The asset management segment’s operating profit before client acquisition in the first half of 2023 was EUR 0.83 million.
During the reporting period, the INDEXO group’s expenses amounted to EUR 2.8 million (compared to EUR 1.5 million in H1 2022). The level of expenses reflects the strategic decision of the company management to continue investment into developing a credit institution, as well as to continue to actively attract customers. Given the significant investments made during the reporting period in the company's growth and customer acquisition, the INDEXO group’s financial performance for the reporting period was a loss of EUR 1.4 million (compared to a loss of EUR 0.4 million in H1 2022).
As previously reported, in parallel to pension management, INDEXO continues to work actively to launch banking operations. Currently, the bank's licensing documentation is being reviewed by the Bank of Latvia and the European Central Bank. Alongside, INDEXO continues work on the technical readiness of the new bank - the development of an innovative and convenient mobile application and customer-friendly services, and new talented specialists continue to join the INDEXO bank project team.
Disclaimer: Bank (credit institution) license is subject to authorization granted by the European Central Bank based on the Bank of Latvia proposal.
INDEXO is an asset management company licensed by the Bank of Latvia, which offers modern 2nd and 3rd pillar pension saving plans in Latvia. INDEXO is the fastest growing pension management company in Latvia with more than 115 thousand customers and more than EUR 780 million in assets under management.
INDEXO was established in 2017 by a group of 30 experienced business representatives and managers with an aim to fight for a better financial environment in Latvia. INDEXO vision is to become a financial services group, offering modern and customized services that empower Latvian people to take care of their financial wellbeing.
Additional information is available at www.indexo.lv.