Online Reporter
Business Reporter
THE asset management sector experienced a contraction in the second quarter of 2025, with total Funds Under Management (FUM) falling 11,44 percent to ZiG82,68 billion as at 30 June 2025.
The decline was entirely driven by a flight from local currency holdings, despite robust growth in US dollar-denominated funds, statistics from the Securities and Exchange Commission of Zimbabwe show.
Data shows that ZiG-denominated FUM fell by 40,97 percent from ZiG38,18 billion to ZiG22,54 billion.
In contrast, US dollar-denominated FUM increased by 8,28 percent over the same period, rising from US$2,06 billion to US$2,31 billion.
The US dollar portion now accounts for a dominating 72,74 percent of the sector’s total FUM.
The translation of the growing US dollar assets into local currency suggests an implied exchange rate of about ZiG26,03 per U.S. dollar as at the quarter-end, providing a crucial context for the reported local currency figures.
Alongside the currency migration, asset managers significantly rebalanced their portfolios, favouring the stock market and more liquid assets over property.
The proportion of FUM invested in property experienced the largest decline, dropping from 48,45 percent to 40,91 percent.
Stock market exposure increased from 29,36 percent to 31,71 percent, money market investments rose from 8,85 percent to 10,30 percent, reflecting a move toward safety and short-term yields, bonds grew from 6,62 percent to 8.56 percent, while unquoted equities increased slightly from 4,5 percent to 5,56 percent.
The remaining 2,95 percent was allocated to cash, call deposits, and other investments.
The performance of the Collective Investment Scheme (CIS) segment highlighted the dual nature of the market.
ZiG-denominated CIS FUM contracted by 13,28 percent to ZiG1,61 billion, primarily attributed to the dissolution of the Mombe Mari Unit Trust, which held a net asset value of ZiG231,79 million in the previous quarter.
Conversely, US dollar-denominated CIS FUM surged by 10,26 percent, climbing from US$83,44 million to US$92 million.
The growth was largely driven by the performance and uptake of newly launched Real Estate Investment Trusts (REITs), specifically Seatrite Five REIT and Eagle REIT, demonstrating continued institutional and retail appetite for hard currency, dividend-yielding property assets.
