First corporate bond fund launched for credit unions in Kilkenny
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Amundi, Europe’s largest asset manager and leading financial services firm Goodbody have jointly launched the first corporate bond fund for credit unions in Ireland, bringing innovation and choice to the sector as well as helping the institutions to mitigate against the impact of negative interest rates.
The launch of the €150 million+ Amundi Fund Solutions ICAV Select Investment Grade Bond fund enables credit unions to invest in a diversified portfolio of corporate bonds in efforts to achieve an attractive yield. Up until now, credit unions could only invest in a limited range of investment options including bank deposits, government bonds and bank bonds. The move follows Central Bank Regulations in 2018 that allowed Credit Unions to invest in a corporate bond fund with a minimum requirement of €150 million at launch.
A group of about 40 credit unions struggling with excess funds have taken advantage of a relaxation of investment restrictions in 2018 to invest more than â¬150 million in a corporate bond fund put together by asset management giant Amundi and Goodbody Stockbrokers.
The fund, which is invested in more than 50 companies, is the first of its kind to get off the ground in the Republic since the Central Bank moved in 2018 to allow credit unions to invest in a corporate bond fund that had a minimum of â¬150 million at launch.
Goodbody had been working with credit unions since last September on the initiative.
For much of the last year, David Harte and his team at Amundi Ireland have managed the billions of euro of investment assets in their care from their kitchen tables.
But being away from their high rise office at Dublin’s Georges Quay certainly has not dented their ambition.
Its new Irish retail business, launched in 2020, has already taken in €1bn of new investment assets. Harte now believes it will have €3bn under management after its first three years, rather than the €2bn he had targeted.
And that is just one part of a plan to grow the Irish business and build its importance within the wider French-headquartered Amundi operation, which has €1.7trn assets under management (AUM). The Irish arm employs 350 staff with €43bn of AUM. Both figures are set to grow, says Harte. As Irish CEO he runs an operation managing assets for everyone from individual investors seeking green-friendly funds to huge institutional clients such as its management of part of the NTMA’s multi
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