By Bruno Federowski
SAO PAULO, March 9 Brazilian wealth managers saw
assets under administration increase by more than one-fifth last
year, when growing confidence in a recovery in Latin America's
largest economy drove the strongest interest rate, currency and
stock rally in seven years.
Assets under management rose 20.7 percent to 90.1 billion
reais ($28.3 billion) last year, with fixed-income products
accounting for nearly half of all investments, industry group
Anbima said in a report on Thursday.
Even as Brazil's interbank interest rates averaged 14
percent - the highest among the world's top 10 economies -
equity investments rose as a share of total assets for the first
time since at least 2014, the Anbima report showed.
Borrowing costs in Brazil, which touched single-digits for a
short period between 2012 and 2013, have for long lured
government bond investors, subtracting pace from equity and
other alternative investments.
Brazil's benchmark Bovespa stock index jumped 39
percent in 2016, boosted by hopes that President Michel Temer
would curb public spending following the ouster of his leftist
predecessor, Dilma Rousseff.
In a conference call, Anbima director Ricardo Ziliotto said
he expects positive trends to continue in the coming year as
Temer advances on an agenda to cut pension, labor and budget
largess, which could lead rates to fall further.
"The industry is moderately optimistic, as we can tell not
only by the figures but also by meeting with clients," he said.
Equities and cross-asset funds, which can invest in a
diverse range of products, are likely to benefit the most from
the rebound, Ziliotto added.
Major cross-asset funds have closed off to new entrants in
face of surging demand, while others have opened new vehicles to
capitalize on the trend.
($1 = 3.1797 reais)
(Editing by Guillermo Parra-Bernal and Jonathan Oatis)