The assets of insurance companies placed in the instruments of the stock market in January-March 2018 amounted to UAH 11.326 billion, which is UAH 2.625 billion, or 18.8% less than in the same period in 2017, member of the National Commission for State Regulation of Financial Services Markets Oleksandr Zaletov has told Interfax-Ukraine. According to him, due to regulatory requirements and stagnation of the national stock market, the volume of shares and corporate bonds in the structure of insurance companies’ assets is steadily declining. In the first quarter of 2018, investments in shares decreased by 23.7% compared to the same period in 2017, or by UAH 1.746 billion, in corporate bonds by 13.7%, or by UAH 126.5 million.
At the same time, Zaletov notes the growth of investing of insurers’ funds in government domestic loan bonds continues – by 15.5%, or by UAH 859.9 million. At the same time, income from investments in government domestic loan bonds for the period increased by 29%.
“The stability of the hryvnia and higher interest rates contributed to the growth of insurers’ national currency investments both in deposits and current accounts. But this did not save from the decline in the yield of this category of assets by 6.8%. In addition, investment in the economy of the country in the areas defined by the government rose by 54.8%, or UAH 150.5 million,” the expert said.
Foreign investors actively study materials, come to look at assets and meet with owners, which is evidence of gradual resumption of the interest to Ukrainian assets, according to the 18th edition of the Ernst & Young Global (EY) Capital Confidence Barometer (CCB). “So, we should hope for the return of foreign investors to the capital market of Ukraine,” EY said in the press release. EY conducts CCB study twice a year. Over 2,500 senior executives across 43 countries took part in it. More than half of respondents (52%) indicate that they plan to acquire in the next 12 months. The number of executives expecting to complete more deals in the next year has more than doubled (67% in April 2018 versus 33% in April 2017). According to the analysts, this shows trends of rising economic and corporate confidence.
According to the press release of EY, although the global level of activity of mergers and acquisitions has already exceeded the peak period set before the financial crisis in 2007, Ukraine is still lagging behind in terms of investment activity. However, it shows a positive trend: foreign investors, who before the crisis invested money in the Ukrainian business, for the first time since 2014 begin to compete with local companies for attractive assets.
This was thanks to the fact that Ukrainian companies owned by foreign investors joined Ukrainian companies, which are fully owned by local businessmen, since 2017.