Welcome Address. Kieran Fox. Irish Funds. 2 irishfunds.ie

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2 Welcome Address Kieran Fox Irish Funds 2 irishfunds.ie

3 Total Assets Under Administration Split between Irish & Non Irish Funds Total Assets Under Administration 4,500 4,000 3,806 4,095 4,251 EUR Billion 3,500 3,000 2,500 2,000 1,500 1, ,883 1,886 1,394 1,398 1, , ,375 2,722 2,199 1,899 2,085 2,231 1, , June- 17 Net Assets Domiciled Net Assets Non Domiciled 3 irishfunds.ie

4 Irish Domiciled Assets UCITS represent 75% of Irish Domiciled Assets 86 UCITS Man Cos 156 AIFMs Registered or Authorised 597 AIFMs operating in Ireland on cross border basis 364 ICAVs established (since 18 March 2015) 4 irishfunds.ie

5 Ireland s Relationship with European Investment Fund Landscape 13 trillion in assets 8 trillion UCITS 5 trillion Alternative Investment Funds (AIFs) 1 trillion of net inflows into UCITS over last 3 years 463 billion net inflows into European funds 2016 (>30% of which went to Irish domiciled funds) 5 irishfunds.ie

6 Growth of Largest European Fund Domiciles 250 % Growth Europe Luxembourg Ireland France Germany UK Source: EFAMA Statistics 6 irishfunds.ie

7 Irish Funds: Passport to Europe & Beyond UCITS funds & AIFMs benefit from an EU wide passport and can be sold in any other EEA member state without need for additional authorisation Global Distribution of Irish Funds: 70 countries Top 10 countries where Irish Funds registered for sale 1. UK 6. Austria 2. Germany 7. Luxembourg 3. France 8. Sweden 4. Switzerland 9. Italy 5. Netherlands 10. Spain 7 irishfunds.ie

8 Irish Funds Maximising Distribution 8 irishfunds.ie

9 Irish Domiciled Funds Net Sales EUR Mn 180, , , , ,000 80,000 60,000 40,000 20,000 0 Equity Funds Bond Funds Balanced Funds Money Market Funds AIF Net Sales - Total Domiciled Funds 98,463 Net Sales into Irish funds by type Bn , , ,706 Dec-13 Dec-14 Dec-15 Dec-16 YTD June 2017 Net sales for YTD June 2017 have already surpassed the total for 2016 which itself was a record year 9 irishfunds.ie 139, , YTD June Net Sales - Total Domiciled Funds 2017

10 ETFs - An Irish Success Ireland as a Domicile for European ETFs Total Assets of European ETFs - Bn Rest of Europe 248 bn 44% bn Ireland % Net Sales into All European ETFs 2016 Bn 3 Bn 7% Ireland Rest of Europe Source: Irish Funds, June Bn 93% 10 irishfunds.ie

11 Looking Ahead - Technology 11 irishfunds.ie

12 Looking Ahead Brexit Three interdependent themes Current context OVER 2,000 IRISH FUNDS SOLD TO UK INVESTORS 1 Target outcome Continuity in UK investor access to EU/Irish funds Distribution Management Models ( Delegation ) 613 bn 2 IN IRISH FUND ASSETS MANAGED BY 170+ UK FIRMS IN IRELAND 2 SOURCE: 1-Lipper IM Dec Monterrey Ireland Fund Report 2016 Growth Increase Ireland s growth trajectory as an international asset management centre Continuity in UK firm management of Irish funds 12 irishfunds.ie

13 International asset management centre Opportunity Benefits Re-affirm Ireland s attractiveness as an international asset management centre The Basics Predictability / efficiency of regulatory process 12.5% corporate tax rate Common law system Only English-speaking country in the Eurozone Less expensive than Zurich, Paris & Luxembourg 1 Growth Asset Manager Activity 800+ investment firms active in Ireland 4 Increased presence of front office activities 18 of the top 20 global AMs have Irish funds 4trn total AuA, 300bn managed from Ireland 2 AM counterparties already in transit from UK NOTES: 1. Source PwC 2. (STEM = Science, Technology, Engineering & Mathematics) & _all_undergraduate_by_level_and_field.xlsx 3. IFS 2020 Action Plan 2017 ( & IDA Ireland 4. MiFID firms, UCITS ManCos, Irish AIFMs & Non-Irish AIFMs Infrastructure Space for 100K new employees by 2020, 100K new houses 3 Leading global tech centre & fintech location London-Dublin: Most flight options in Europe 35K+ employed in international financial services in Ireland, 14K in funds industry 130K degree-level graduates across business, law and STEM w/ 20K new grads p.a. 2 Solution Provide UK managers with options to support the establishment of a physical presence in Ireland 13 irishfunds.ie

14 Irish Economics and FDI Update Gerard Whitty IDA Ireland 14 irishfunds.ie

15 Q3 Economic Performance & Recent Financial Services Success Stories Gerard Whitty, Director, ASEAN & Taiwan IDA Ireland, Singapore Office

16 IDA Performance in first half of ,000+ job approvals compared with 9,100 in H Same high level of investments secured as this time last year at 114 Industry Sectors: Life Sciences Business Services Technology IFS

17 Investment Projects Announced in 2017

18 MNCs make significant contribution to Irish Economy 10% of Total Employment in Ireland 64% of Exports 80% of Corporation Tax 65% of RD&I Investment + 14,000 R&D staff 18.7bn annual spend in Irish Economy on payroll, materials and services 5.5bn cap ex investment annually 4

19 bn Fastest growing, most competitive economy in Eurozone Fastest growing economy in Eurozone for past three years ( ) 6th Most competitive economy in the world GDP growth of 5.2% in 2016 Broad-based growth; consumer spend +3%, construction +11% and exports +3.2%, all contributing positively to growth. + Inflation lowest level in EU + Personal debt in Ireland at lowest level since National and International forecasts predict strong GDP growth will continue in , , , , ,000 50,000 0 GDP Constant Prices GDP Forecasts 2017 European Commission 4.0 Department of Finance 4.3 Central Bank of Ireland 3.5 IMF 3.5 OECD 3.2 5

20 Growing Economy Boosts Public Finances Focus of Government policy on reducing debt levels has been effective: Tax revenue +4% in H1 2017; income tax +3%, corporate tax + 11%. Budget deficit 0.4% estimated for 2017; significantly below EU 3% target. Debt ratio 75% in % 1% 0% -1% -2% -3% -4% General Government Balance % GDP -2.0% -0.6% -0.4% -0.1% 0.2% 0.7% 1.1% -3.7% Ireland s debt to GDP ratio is below the Euro area (90%) and EU (85%) averages Debt to GDP Ratio Irish Govt. debt has an A grade investor rating with all major Ratings agencies* Irish bond yields are trading below 1% and in line with 40 core European sovereign yields. 20 * Standard & Poor's, Fitch, Moody's, DBRS, R&I Source: Department of Finance Budget

21 Unemployment Rate Numbers Employed Labour Market Continues to Strengthen + Strong employment growth: over 2.05 million people now 16 2,100 at work in Ireland. 14 2,050 + Unemployment 6.3% in June 2017 down from peak of 15% 12 2,000 in ,950 + Exporting companies created 1 in every 2.5 additional jobs 8 1,900 in Ireland since ,850 + Ireland s unemployment rate below EU (7.8%) and Euro 4 1,800 area (9.3%) average. 2 1, saw return to net inward migration to Ireland for the 0 1,700 first time since 2009 as employment opportunities steadily Q1 11 Q1 12 Q1 13 Q1 14 Q1 15 Q1 16 Q1 17 increase. Unemployment rate % Employed Source: CSO, QNHS Q Monthly Unemployment Rate Central Statistics Office June 2017 Eurostat SA May 2017 release EI & IDA clients net jobs created 85,000, total additional jobs in economy 199,200 7

22 6th most Competitive Economy in World + Competitiveness gains sustained as the economy grows strongly. + Inflation below the EU average since Reflected in Global Competitiveness Reports: + Ireland is ranked amongst the top countries in the world to do business + IMD ranks Ireland 6 th in the World for overall competitiveness. + Forbes ranks Ireland the 4 th best country in the World to do business Reputation Institute Country Index 2016 WEF Global Competitivenes s Report 2017 IMD World Competitivenes s Yearbook Transparency International Corruption Perception Index World Bank Doing Business Forbes Best Country in the World to do Business 2016 OECD FDI Regulatory Restrictiveness Index 2016 Global Entrepreneursh ip Index 2017 Ireland's International Ranking 8

23 Knowledge and Talent Ireland is the only English speaking country in the Eurozone. Education system ranked in the top 10 in the world. 98% participation rate in education amongst 18 year olds in Europe Highest in Europe. 52% aged have successfully completed third level studies (EU average 39%). New International Baccalaureate School being established in Dublin Youngest Population in the EU: 33% under 25 (EU 28: 26.8%). 7th lowest old-age dependency ratio in OECD (18.6%). Compared to 31.3% in Germany, and 29% in Euro area as a whole. The IMD Competitiveness Yearbook 2017 ranks Ireland globally as: 1st for attracting and retaining talent 5th for availability of skilled labour 6th for financial skills 9

24 Labour Costs Compared + Irish hourly labour costs are below the Euro Area average. + Irish labour costs are 11th in the EU, below countries like the UK, Germany, Belgium, Luxemburg and the Netherlands. Source Eurostat 2016 Denmark Belgium Sweden Luxembourg France Finland Netherlands Germany Austria Euro area United Kingdom Ireland Italy European Union Spain Slovenia Cyprus Greece Portugal Malta Estonia Slovakia Czech Republic Croatia Poland Hungary Latvia Lithuania Romania Bulgaria Labour cost per hour

25 One of Europe's most Productive Economies + Labour costs do not tell the whole story, productivity is also key. + Irish labour productivity is 74% above the EU27 average. Source: Eurostat 2015, Labour productivity measures the amount of GDP produced by one person in one hour. Luxembourg Ireland Norway Belgium Denmark France Netherlands Germany Switzerland Austria Sweden Euro area (19 countries) Finland Italy United Kingdom EU Spain Slovenia Slovakia Cyprus Malta Czech Republic Portugal Greece Hungary Lithuania Estonia Croatia Poland Latvia Romania Bulgaria Labour Productivity

26 Brexit Recap + IDA Ireland has been discussing risk of Brexit with clients and prospects since before June 2016; + Consensus view was that Brexit very unlikely ; + Limited Contingency Planning by Financial Services Firms + Result of UK Referendum a major shock ; + Companies have spent the last 12 months struggling to respond; + Complex analysis and locational due diligence on-going for several months now with significant IDA Ireland input.

27 Key Issues for Financial Services Companies + Retain Market Access & preserve EU customer relationships. + Secure an EU Regulatory Passport (Financial Services). + What impact does Brexit have on current UK / London / EU operations? + Relocate activities / functions to an EU domicile consistent with the lowest disruption and highest efficiency. + Where possible, use existing intra-eu infrastructures (branches, subsidiaries, legal entities) and/or reconfigure and optimize overall EU business. + 2-year Lead Time of Brexit hugely challenging & Day 1 readiness critical. + Lobby for a Soft Brexit and / or transitional arrangements.

28 Current & Potential Relocations Working Draft

29 Financial Services Investments Won

30 Conclusions In the face of global economic & political uncertainty Ireland remains a stable, competitive, secure, pro-business economy. FDI investment in Ireland continues to grow strongly. Ireland will remain a core member of the EU single market & Euro currency. IMD ranks Ireland 6th in the world for overall competitiveness. Strongest growing economy in EU. Unemployment halves in 4 years to below EU and Eurozone averages. 16

31 Gerard WHITTY DIRECTOR, ASEAN & TAIWAN IDA IRELAND, SINGAPORE OFFICE / GERARD.WHITTY@IDA.IE To learn more log on to IDA IRELAND DUBLIN HQ idaireland@ida.ie

32 Panel One Trends in Irish Funds Moderator: Catriona Carty, Maples and Calder Panellists: Peng-Way Choy, FundRock Management Company SA Patrick Robinson, Bridge Consulting Chee Seng Chua, Arisaig Partners Simon Hopkins, Milltrust International Group 15 irishfunds.ie

33 Keynote Presentation: Distribution Landscape Update Armin Choksey PwC 16 irishfunds.ie

34 Keynote Presentation: Overview of the S-VACC Initiative Elean Chin Monetary Authority of Singapore 17 irishfunds.ie

35 Panel Two The S-VACC Regime Moderator: Caroline Higgins, Northern Trust Panellists: Philippa Allen, ComplianceAsia Consulting Ltd Declan Murphy, PwC Jasmine Tan, Standard Chartered 18 irishfunds.ie

36 Closing Comments Kieran Fox Irish Funds 19 irishfunds.ie

37 Drinks Reception Kindly Sponsored by PwC. 20 irishfunds.ie