Swedish Firms Gain Access to Foreign Funds

Terry Flanagan

Swedish investment firms can now get automated access to more than 80,000 foreign funds from 25 markets as Euroclear Sweden links to Euroclear Bank’s FundSettle platform.

Euroclear said in a statement that the Swedish Central Securities Depository has launched a link to FundSettle, Euroclear Bank’s automated processing platform for cross-border and domestic funds.

Swedish distributors, cross-border fund management companies and transfer agents can now use automated fund-transaction order routing between relevant parties on a straight-through processing basis at Euroclear Sweden, lowering their processing costs and risks.

Swedish bank Nordnet was one of the first to use the service according to Euroclear. Tomas Blomster, head of fund operations at Nordnet, said in an email: “We want to be ahead of our competitors and at the forefront of modern solutions and innovations. Our clients trading in funds that go through Euroclear will eventually experience a faster process, from order entry to settlement.”

Paul Brady, director at Franklin Templeton Investments, said in a statement: “We welcome this initiative as we strongly believe that we will continue to be able to deliver our funds to this important Nordic market, via a proven, safe and efficient distribution network.”

Later this year FundSettle will make Swedish funds available to non-Swedish investors for automated, electronic transaction processing.

Cerulli Associates, the research provider, said in its latest Global Edge report that last November Swedish mutual funds had $244.9bn of assets under management, a 20% increase from assets of $203.4bn at the end of 2012.

Anders Löfgren, head of product management at Euroclear Sweden, said in a statement that the Swedish fund market had an increase in net inflows of Swedish Kroner 430bn ($67bn) between 2012 and 2103 according to Fondbolagens Föreningen, the Swedish Investment Fund Association.

“This strong trend of fund buying has continued into 2014, and spurred Euroclear to further strengthen its operational support to the Swedish investment industry by expanding the scope of possibilities and diversification opportunities to all relevant parties,” added Löfgren.

The Swedish Investment Fund Association reported that in February total net assets reached a new all-time high of SEK 2,535bn ($394bn), of which 56% was invested in equities.

Last month Swedish funds had a total net inflow of SEK 11.9bn. Bond funds had SEK 6.4bn of net inflows and balanced funds and equity funds receiving net deposits of SEK 4.3bn and SEK 1.8bn respectively.

Pia Nilsson, managing director of the Swedish Investment Fund Association, said in a statement: “2014 has started off with two months of large net inflows into funds. Equity funds showed large discrepancies. Global and sector funds experienced large inflows whereas turbulence in the emerging markets contributed to net outflows from these markets.”

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