The Warsaw stock market results in the first quarter of 2007 exceeded the expectations of even the greatest optimists.
The Warsaw stock market results in the first quarter of 2007 exceeded the expectations of even the greatest optimists. Despite a brief correction, the main WIG equity index gained over 14%, which means another quarter of high profits for those Commercial Union (CU) Life clients who chose equity-oriented and mixed funds within individual and group life insurance and employee pension programmes.
"Mainly local factors are responsible for such a bullish market, mainly Poland's dynamic economic growth combined with low inflation. Also a strong influx of retail customers' assets to mutual funds and directly to the stock exchange has been very significant. These factors prevailed over concerns about overvaluation of equities and investor caution on global markets," says Marek Przybylski, general manager of Commercial Union Investment Management Poland, the company managing assets of CU Life funds.
Returns achievable on the bond market in the past quarter were much lower than the gains on equities, but were competitive compared to interest earned on bank deposits.
"Equity price increases like those occurring in the last five years on the Polish stock exchange are rare on global markets. The bull market in Warsaw has been caused by a one-off process - namely the transformation of the Polish economy reinforced by joining the European Union three years ago," emphasises Marek Przybylski.
The results of equity-oriented and mixed funds of CU Life for the last five years are thus spectacular - eg over 360% return rate for the Dynamic Fund.
Commercial Union Poland Life Insurance Company offers over a dozen life funds linked to individual and group life policies and employee pension programmes. The funds represent a wide spectrum of investment strategies. CU is one of few life insurers in Poland which boast a ten year investment history of a number of its capital funds.
Assets of CU Life funds are managed by a specialised company, Commercial Union Investment Management Poland. It has permission from the Polish regulator to manage securities's portfolios and provide investment advisory. It is the fourth asset management company in Poland by assets under management (in total over 15 billion zlotys at the end of the first quarter 2007).
Rates of return of CU Poland life funds at the end of the first quarter of 2007 [%]
| Fund | 3 months | 12 months | 3 years | 5 years | 10 years |
| Monetary | 0.66 | 2.65 | 12.28 | - | - |
| Guaranteed | 1.32 | 5.20 | 17.08 | 34.88 | 167.23 |
| Guaranteed Plus | 1.23 | 4.57 | 14.68 | 26.56 | - |
| Stable Growth | 2.80 | 7.07 | 25.90 | 52.55 | 229.86 |
| Balanced | 7.21 | 20.37 | 64.07 | 127.26 | 304.06 |
| Eurobalanced | 2.90 | 4.30 | 5.90 | - | - |
| International | 4.22 | 9.94 | 30.69 | 56.71 | 125.36 |
| CU - Equity Fund | 14.49 | 40.73 | 129.84 | 271.49 | - |
| Dynamic | 14.42 | 39.68 | 130.86 | 365.65 | - |
| PPE* Bonds | 0.73 | 2.82 | 16.10 | - | - |
| PPE Stable Growth | 3.65 | 10.59 | 35.57 | 74.94 | - |
| PPE Balanced | 7.08 | 19.71 | - | - | - |
| PPE Equities | 14.13 | 39.65 | - | - | - |
| WIG | 14.11 | 43.02 | 140.99 | 282.82 | 244.49 |
| Inflation | 1.1 | 2.4 | 6.9 | 9.2 | 59.7 |
* PPE - fund dedicated to employee pension programmes
Figures prepared on a local basis.
-ends-
Information:
Bohdan Bialorucki
Telephone: +48 22 557 43 41
E-mail: bohdan_bialorucki@cu.com.pl
For further information, see http://www.cu.com.pl/
Notes to editors:
Commercial Union Poland group is part of the international Aviva group - the world's fifth largest insurance, savings and investments group, and the largest in the United Kingdom by revenues. Aviva group operates in 25 countries. It occupies a strong position in the European Union, including United Kingdom, Ireland, France, the Netherlands, Spain, Italy and Poland. It also conducts large scale activities in the USA, Canada, Australia and Asia. It services approx 35 million customers and manages assets valued at over £364 billion. For additional information, see the website /