|
With mutual fund activities surging over the past two years,
Finance Minister Sri Mulyani Indrawati said he was upbeat the industry
would in 2008 grow even further.
"From the end of 2007, the net asset value (NAV) of mutual funds
reached more than Rp 90 trillion (around US$9.8 billion), growing by
some 75 percent from one year earlier," Sri Mulyani said Wednesday.
"I am optimistic that we can override our highest NAV record in 2004."
In 2004, the NAV of mutual funds reached Rp 104 trillion.
Although 2007's NAV was not as high as 2004's, the significant rise
showed investors' trust in the industry, the minister said.
"The significant and consistent progress in the past couple of years
was a positive signal for the industry to grow further this year."
Fuad Rahmany, the Financial Institutions and Coordinating Investment
Board (Bapepam-LK) chairman, said the number of mutual fund products
rose by 17.5 percent to 469 units in 2007, from 399 in 2006.
"Meanwhile, the NAV grew 75 percent to Rp 91.5 trillion from the end of
last year, from Rp 52.28 trillion in 2006," Fuad said.
He said to boost market performance this year, the government would
release a new regulation offering a tax incentive to listed companies,
in the form of tax reduction.
"With such a tax incentive, the number of listed companies is expected
to increase in 2008," he said.
This could mean the interest in mutual funds, because many of the
collected monies are invested on the stock market, would also increase,
he said.
In addition to the planned regulation, Bapepam-LK would also simplify
procedures for the processing of initial public offering (IPO) permits,
Fuad said.
"The processing for IPO permits will be cut to 20 days from the 45 days
mentioned in the existing regulation."
The booming of the mutual funds industry in Indonesia started in the
early 2000s.
An investor then could receive a large return, sometimes more than 50
percent a year on an investment.
In 2005, however, the industry was hit by the "redemption" trauma, when
rising interest rates caused bond prices and the value of fixed-income
mutual funds to fall.
Many investors, due to a lack of information, cashed in their
belongings and invested them in higher-interest deposits. And this lead
to a worsening decline in the industry's NAV.
Bapepam-LK said the industry's then-NAV dropped to Rp 46 trillion in
the first week of September 2005, from Rp 105 trillion in March 2005.
Fuad said Bapepam-LK would also release some new rules including one on
Secondary Mortgage Facilities (SMF), to complete the existing rules on
real estate investment trusts (REIT), sharia products, the issuance of
bonds by regional governments, asset-backed securities (EBA) and
exchange traded funds (ETF).
|
