ESPA ČESKÝ FOND STÁTNÍCH DLUHOPISŮ. Mutual fund pursuant to the InvFG

Transcription

1 ESPA ČESKÝ FOND STÁTNÍCH DLUHOPISŮ Mutual fund pursuant to the InvFG Semi-Annual Report 2017

2 Semi-Annual Report 2017 Contents General Information about the Investment Firm... 2 Development of the Fund... 3 Asset Allocation... 4 Fund Portfolio as of 31 August

3 ESPA ČESKÝ FOND STÁTNÍCH DLUHOPISŮ General Information about the Investment Firm The company ERSTE-SPARINVEST Kapitalanlagegesellschaft m. b. H. Am Belvedere 1, A-1100 Vienna Telephone: , Fax: Nominal capital EUR 4.50 million Shareholders Erste Asset Management GmbH (81.48%) DekaBank Deutsche Girozentrale (2.87%) Die Kärntner Trust-Vermögensverwaltungsgesellschaft m.b.h. & Co KG (2.87 %) NÖ-Sparkassen Beteiligungsgesellschaft m. b. H. (1.31%) Salzburger Sparkasse Bank Aktiengesellschaft (2.87%) Sieben Tiroler Sparkassen Beteiligungsgesellschaft m. b. H. (2.87%) Steiermärkische Bank und Sparkassen Aktiengesellschaft (5.73%) Supervisory Board Managing directors Prokuristen (proxies) State commissioners Auditor Custodian bank Wolfgang TRAINDL, Mag. (Chairman) Gabriele SEMMELROCK-WERZER (Deputy Chairwoman, First Deputy) Franz-Nikolaus HÖRMANN, Mag. (Deputy Chairman, Second Deputy) Matthias BAUER Josef PRESCHITZ Franz PRUCKNER, Dr. MBA Rupert RIEDER, Mag. Thomas SCHAUFLER, Mag. (FH) Reinhard WALTL, Mag. Appointed by the Works Council: Martin CECH Regina HABERHAUER, Mag. (FH) Heinrich Hubert REINER, Ing. Peter RIEDERER Manfred ZOUREK, Mag. Heinz BEDNAR, Mag. Günther MANDL Christian SCHÖN Achim ARNHOF, Mag. Winfried BUCHBAUER, Mag. Karl FREUDENSCHUSS Dietmar JAROSCH, Dr. Manfred LENTNER Gerold PERMOSER Magdalena REISCHL, Mag. Jürgen SINGER, Mag. Erwin GRUBER Michael MANHARD, HR Dr. Ernst & Young Wirtschaftsprüfungsgesellschaft m.b.h. Erste Group Bank AG 2

4 Semi-Annual Report 2017 Dear Shareholder, We are pleased to present you the following semi-annual report for the ESPA ČESKÝ FOND STÁTNÍCH DLUHOPISŮ mutual fund pursuant to the InvFG for the period from 1 March 2017 to 31 August Development of the Fund During the last half year, the Czech economy entered into a phase of significant acceleration, driven in part by the favourable external conditions. The economic recovery was accompanied by rising inflation, which consistently remained at or above the Czech National Bank s target of 2%. GDP growth came in at 4.7% in the second quarter, primarily due to the increase in investment activity and private consumption. Core inflation remained persistently above 2%. According to the CNB, the inflation forecast is more susceptible to upside risks than downside risks. This assumption is supported by macroeconomic statistics, which confirm the inflationary pressure. For example, wage growth has gradually started to exceed expectations, the supply of workers on the labour market is extremely low, and consumer sentiment is solid. In recent months, the overall situation has called for measures to dampen economic activity rather than stimulate it. The CNB s macroeconomic projections, which were in keeping with the interest rate hike, also proved to be fairly accurate. The CNB Board s March meeting was watched very closely. The official end of the currency cap commitment came just a few days before the meeting, and investors were looking for indications of the timing and procedure for the end of the commitment and for the future monetary policy course. At the meeting, the CNB upheld its promise not to discontinue the exchange rate cap before the end of the quarter, but no longer communicated the likely date for the end of its currency cap regime at the start of the March meeting. The CNB abandoned this policy at its Thursday meeting on 6 April The market s reaction to the decision was much less severe than had been anticipated. Short-term interest rates increased by a few basis points, but these gains were then partially reversed (with rates remaining in negative territory). Long-term yields exhibited smaller movements. The exchange rate showed a bit of movement before settling into a gradual upward trend and stabilising at CZK/EUR in August. At the end of the first quarter, it became increasingly clear that the nature of the speculative inflows had changed. The most significant factor here was likely concerns about the koruna being overbought, which forced foreign investors to adapt their strategies. These concerns were manifested in the demand for longer-term government bonds and may remain on the market for a time. A second factor may have been the reclassification of Czech government bonds to J.P. Morgan s emerging markets indices at the end of February. In the meantime, the currency interventions the CNB had to conduct remained massive, reaching a record of CZK 520 billion in March. Contrary to the trends in the fundamental data, yields on government bonds did not rise further after the weeks surrounding the CNB s decisive meeting. In fact, they exhibited steep downward movements at times, which were presumably connected to the index reclassification mentioned above and ultimately underwent at least a partial correction. For the most part, however, they did not rise above the peaks seen during March and April. Some of these movements may also have been related to investors building up their positions again and moving along the curve. There was a great deal of uncertainty regarding speculative positions in the koruna, which in turn clouded the prospects for a potential reduction of the money supply via the exchange rate. The CNB commented on the exchange rate outlook leading up to its June meeting and played down the last forecast, which gave rise to expectations on the market that a conventional rate hike might not be implemented until around the turn of the year. However, the June meeting ended up having a surprisingly hard tone and boosted expectations of rate hikes in the third quarter, which the CNB then turned into reality at its meeting in August. The reaction on the market was once again rather subdued. An additional rate hike is generally seen as necessary, and the uncertainty regarding the speculative positions and the external environment continue to play a role in this context. The increasingly negative conditions for longer-running bonds made it necessary to further shorten the fund s duration by selling bonds with longer terms (and replacing them with new bonds with shorter terms). This step was implemented over the entire period and resulted in a considerable reduction of the duration. Overall, the reduction helped to mitigate the pace of capital losses for the fund due to the upward shift in the yield curve, but was unable to fully prevent them. 3

5 ESPA ČESKÝ FOND STÁTNÍCH DLUHOPISŮ Asset Allocation 31 August February 2017 CZK million % CZK million % Bonds denominated in CZK Securities Cash in banks Interest entitlements Other deferred items Fund assets Fund Portfolio as of 31 August 2017 (including changes in securities assets from 1 March 2017 to 31 August 2017) Security designation ISIN Interest Purch./ Sales/ Holding Price Value % share number rate additions disposals in CZK of Shares/nominal (nom. in 1,000, rounded) fund assets Publicly traded securities Bonds denominated in CZK Issue country Czech Republic CZECH REP CZ , ,207, CZECH REP CZ , , ,323, CZECH REP FLR 91 CZ , ,525, CZECH REP CZ ,000 31, ,514, CZECH REP CZ ,000 30, ,828, Total issue country Czech Republic 158,398, Total bonds denominated in CZK 158,398, Total publicly traded securities 158,398, Securities admitted to organised markets Bonds denominated in CZK Issue country Czech Republic CZECH REP FLR 63 CZ , ,473, CZECH REP CZ ,000 13, ,703, Total issue country Czech Republic 34,176, Total bonds denominated in CZK 34,176, Total securities admitted to organised markets 34,176,

6 Semi-Annual Report 2017 Breakdown of fund assets Securities 192,574, Cash in banks 27,659, Interest entitlements 376, Other deferred items -142, Fund assets 220,467, Dividend shares outstanding AT shares 8, Share value for dividend share AT CZK KEST-exempt non-dividend shares outstanding AT shares 1,475, Share value for KEST-exempt non-dividend share AT CZK Repurchase agreements and total return swaps are not used for the fund. If securities lending agreements are in effect on the reporting date, they are reported separately below. Explanation on disclosure pursuant to the Delegated Regulation (EU) No. 2016/2251 supplementing Regulation (EU) No. 648/2012 of the European Parliament and of the Council on OTC derivatives, central counterparties and trade repositories with regard to regulatory technical standards for risk-mitigation techniques for OTC derivative contracts not cleared by a central counterparty: All OTC derivatives are traded through Erste Group Bank AG. Collateral in the form of cash or bonds is pledged to Erste Group Bank AG in the amount of the negative exposure of the derivatives. EUR-denominated government bonds from the Republic of Austria and/or the Federal Republic of Germany are pledged by Erste Group Bank AG to the fund in the amount of the positive exposure of the derivatives. A one-time discount of 4% is agreed with the counterparty for this collateral. Collateral that would require a higher discount pursuant to Annex II to the Delegated Regulation (EU) No. 2016/2251 is not accepted. Investor note: The values of assets in illiquid markets may deviate from their actual selling prices. Vienna, September 2017 ERSTE-SPARINVEST Kapitalanlagegesellschaft m.b.h. Electronically signed Inspection information: Note: The electronic signatures in this document can be inspected at This document was signed with two qualified electronic signatures. A qualified electronic signature fulfils the legal requirements of a hand-written signature, and in particular the requirements of the written form as defined in 886 ABGB ( 4 [1] Austrian Signature Act [Signaturgesetz]). 5