April 2019

Active ManagedFund Highlights

Key Market Indices – Summary of Returns to 31st March 2019 (in Euro terms)

Market Review Q1 2019

Asset Class Q1 % YTD % 1 Yr % 3 Yrs % p.a. 5 Yrs % p.a.

Cash: 3 Month Euro Bank Deposit -0.1 -0.1 -0.4 -0.4 -0.2

Government Bonds: ML EMU Gov’t > 5 Year Bond Index 3.8 3.8 3.3 1.7 5.2

LT Government Bonds: ML EMU Gov’t > 10 Year Bond Index 5.2 5.2 4.1 2.0 7.1

Euro Corp Bonds: ML EMU Corporate Large Cap Bond Index 3.2 3.2 2.4 2.2 2.9

Global Equity: FTSE World Index 14.1 14.1 13.0 11.7 11.5

Emerging Mkt Equity: MSCI Emerging Markets Index 12.0 12.0 1.8 11.6 8.4

Commodities: 50% GSCI + 50% GSCI Non-Energy Index 10.1 10.1 5.8 3.3 -5.5

Corporate Client Update

In the end MPs � nished the quarter scratching their heads wondering what happened over not just the last quarter but since the actual vote back in 2016. The question remains will Theresa May have a Dallas moment and suddenly awake believing Brexit was nothing more than a bad dream.

* Monetary policy once more to the foreA slower global growth outlook had markets worried towards the end of 2018. In particular, markets viewed the US Federal Reserve and European Central Bank’s commitments to raising interest rates over 2019 as an ominous omen for the year ahead.

Whilst markets recovered strongly in January with the view that the vigorous sell-o� seen towards the latter part of 2018 was unwarranted, markets had also largely priced in a pause in central bank policy rate rises. Central bankers keen to not agitate markets further acquiesced with the US Federal Reserve announcing it would be cognisant of market factors when rising rates and equity markets moved higher. The biggest impact, however, can be seen across bond markets with the US 10-year treasury yield falling by 0.28%. This has contributed to a phenomenon where the yield on a 10-year treasury is lower than that of the US 3-month treasury, or in technical parlance known as an inverted yield curve. For many economists an inverted yield curve is seen as a harbinger of an impending recession. For now, however, markets march on with the expectation central bankers may once again step in to deliver some more magic syrup to combat any interim fatigue.

* Rising TidesA rising tide lifts all boats, that is, irrespective of whether the tidal � ow is driven by celestial or more seismic factors. The � rst quarter of 2019 saw markets trend upwards with aplomb driven by a turn in investor sentiment and changes in central bank policy. Stock markets rallied recovering the previous quarter’s sell o� as bears were forcibly sent to hibernate. Aided by a more accommodative monetary policy, bond markets joined in on the rally resulting in positive returns across the majority of asset classes.

Global equities � nished the quarter up 14.1% in euro terms. This performance was driven by less downside focus on corporate earnings which were largely in line with expectations, a softening in political risk and a weaker euro.

* Political squawking but no golden eggsA major theme for Q1 2019 was political interference and the magnitude to which it impacted markets. Despite the general view on slower growth across the global economy, hopes of a resolution being achieved between the US and China on trade tari� discussions helped support equity markets. The quarter saw regular media posturing from US President Donald Trump on the “big progress” or “great deal” being reached and whilst the quarter ended with no de� nitive agreement between both parties, markets ticked upwards with the expectation of a deal being struck shortly.

UK parliament turned into a veri� able rookery over the quarter as the UK’s deadline to leave the EU approached, yet MPs could not agree on how to � y the EU coop. Public addresses were frequent, feathers were ru� ed across the � oor and votes aplenty were cast and counted.

Average Return for Q1 10.1%

Best Performer for Q1 11.2%Aberdeen Standard Investments

Average Return 1 Year 7.4%

Best Performer 1 Year 11.1%Davy Asset Management

Best over 3 years 8.5% p.a.Setanta Asset Management

Best over 5 years 9.4% p.a.Setanta Asset Management

and Davy Asset Management

Best over 10 years 12.1% p.a.Setanta Asset Management

Warning: Past performance may not be a reliable guide to future performance. While every care has been taken in collecting this data from investment managers, it has not been audited or verifi ed for accuracy.

Manager Q1 %

Rank YTD%

Rank 1 Year%

Rank 3 yrs% p.a.

Rank 5 yrs% p.a.

Rank 10 yrs % p.a.

Rank

Friends First 10.0 4 10.0 4 7.2 4 7.4 3 8.1 3= 10.4 5

Merrion Investment Managers 10.9 2 10.9 2 3.6 7 4.0 7 6.4 7 10.0 7

New Ireland 9.8 5 9.8 5 5.8 6 7.3 4 7.0 6 10.1 6

Davy Asset Management 10.3 3 10.3 3 11.1 1 8.0 2 9.4 1= 10.8 3

Setanta Asset Management 9.5 6 9.5 6 9.2 2 8.5 1 9.4 1= 12.1 1

Aberdeen Standard Investments 11.2 1 11.2 1 6.7 5 6.7 6 7.5 5 11.5 2

Zurich Life 9.2 7 9.2 7 7.9 3 7.0 5 8.1 3= 10.6 4

Average 10.1 10.1 7.4 7.0 8.0 10.8

Active Managed Funds – Summary of Returns to 31st March 2019

Equities

Manager Ireland % UK % Europe exROI & UK %

NorthAmerica %

Japan % Other % Total % Fixed Interest %

Property % Cash % Alternative Assets %

Total %

Friends First 1.1 3.4 10.2 41.9 5.0 11.5 73.0 25.6 0.0 1.4 0.0 100.0

Merrion Investment Managers 3.2 5.5 9.2 35.6 2.5 8.1 64.1 10.9 2.9 7.7 14.5 100.0

New Ireland 1.1 3.9 23.3 32.0 5.9 7.2 73.4 17.0 4.2 5.4 0.0 100.0

Davy Asset Management 0.0 5.1 13.5 46.0 5.7 1.5 71.8 10.4 11.0 6.8 0.0 100.0

Setanta Asset Management 7.7 10.1 9.7 33.1 1.3 2.3 64.2 14.1 10.0 10.7 1.1 100.0

Aberdeen Standard Investments 0.5 4.5 15.7 38.8 5.9 9.7 75.2 18.1 6.4 0.4 0.0 100.0

Zurich Life 0.0 4.0 10.0 40.0 5.0 4.0 63.0 31.0 0.0 6.0 0.0 100.0

Average 1.9 5.2 13.1 38.2 4.5 6.3 69.2 18.2 4.9 5.6 2.2 100.0

Active Managed Funds – Percentage Asset Allocation as at 31st March 2019

2018 2017 2016 2015 2014

Davy -2.0% Aberdeen Standard 9.3% Setanta 12.2% Merrion 13.6% Setanta 17.8%

Setanta -2.7% Friends First 8.2% New Ireland 9.6% Aberdeen Standard 10.7% Merrion 16.7%

Zurich Life -3.7% New Ireland 7.6% Zurich Life 6.6% Davy 10.4% Davy 16.2%

Friends First -4.6% Setanta 6.8% Davy 6.3% Zurich Life 9.8% Aviva 16.2%

Aberdeen Standard -6.9% Davy 6.4% Friends First/F&C 5.2% Setanta 7.9% Friends First/F&C 15.1%

New Ireland -7.1% Zurich Life 6.1% Aberdeen Standard 1.1% Friends First/F&C 7.4% Aberdeen Standard 15.1%

Merrion -8.9% Merrion 4.4% Merrion -0.7% New Ireland 6.6% Zurich Life 15.1%

Kleinwort Benson 6.4% Kleinwort Benson 14.5%

Aviva 6.3% New Ireland 11.9%

Average -5.1% Average 7.0% Average 5.8% Average 8.8% Average 15.4%

Summary of Managed Fund Returns

Active Managed Funds – Yearly Performance Figures

Representative Fund Performance

Fund Name Q1%

YTD%

1 Year%

3 Yrs% p.a.

5 Yrs% p.a.

10 Yrs% p.a.

Friends First/F&C 9.6 9.6 5.0 7.2 8.1 11.3

Irish Life Investment Managers 10.2 10.2 8.2 7.8 8.6 11.0

Average 9.9 9.9 6.6 7.5 8.4 11.2

Consensus Funds – Summary of Returns to 31st March 2019

Fund Name Type of Fund Q1%

YTD %

1 Yr%

3 Yrs% p.a.

5 Yrs% p.a.

10 Yrs% p.a.

Davy Global Equity Global Equity 13.9 13.9 14.4 10.9 10.4 12.6

Friends First/F&C International Equity Global Equity 12.7 12.7 10.8 10.6 10.4 13.5

ILIM Dynamic Global Value Global Equity (Traditional Value Style) 13.0 13.0 12.7 10.9 11.2 15.3

KBI GI Dividend Plus Global Equity High Yield Global Equity 12.2 12.2 8.5 8.2 9.1 13.7

KBI GI Innovator Alternative Investment Themes/Trends 13.2 13.2 8.4 8.2 4.4 7.4

Merrion Global Equity Global Equity 14.3 14.3 5.9 5.9 7.7 11.8

Merrion High Alpha Concentrated Absolute Return Fund 4.7 4.7 -4.8 -3.6 2.7 5.1

New Ireland Consensus IRIS 2022+ Target Date Lifestyle Fund 5.4 5.4 4.4 4.7 5.4 10.0

Setanta Dividend Fund High Yield Equity 12.5 12.5 13.7 9.8 9.9 13.7

Setanta Global Focus Fund Concentrated Global Equity 9.9 9.9 6.7 7.8 9.5 15.0

Aberdeen Standard Investment GARS Absolute Return Fund 3.6 3.6 -1.4 -0.6 0.6 4.9

Aberdeen Standard Global Equities Global Equity 15.6 15.6 8.0 5.5 6.9 13.0

Zurich Life 5*5 Global Equity Concentrated Global Equity 13.0 13.0 8.6 10.0 9.9 11.3

Zurich Life International Equity Global Equity (Rotational Style) 13.7 13.7 11.0 10.6 10.6 13.3

Summary of Returns to 31st March 2019

Warning: Past performance may not be a reliable guide to future performance. While every care has been taken in collecting this data from investment managers, it has not been audited or verifi ed for accuracy.

For further information please contact:

Neil O’Reilly (noreilly@invesco.ie)

Finian O’Driscoll (fodriscoll@invesco.ie)

Market Outlook

*

Briefl y outlined below are some key considerations with respect to the outlook for the economy in 2019 with a specifi c focus on drivers of global growth and political sentiment. Also included is a snippet from the latest edition of the Invesco Education Series.

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Invesco Limited is regulated by the Central Bank of Ireland. An analysis of Invesco’s activities between those that areregulated by the Central Bank of Ireland and those that are not is set out on the company’s website www.invesco.ie.

* Global growth – squeezing the lemonThe sense of risk aversion from Q4 2018 has fast become a distant memory to many. It is true, growth is slowing, but corporate earnings results were generally in line with expectations which led to strong market support. The question is where do we go from here and what will drive markets going forward? Not an easy question to answer. Global economies have bene� ted from 10 years of strong growth and the reality is that mid to high single digit annual growth is not sustainable over the longer term. Multiple factors have contributed to the growth we have seen including softer monetary policy and in particular, higher levels of corporate debt. The impact of this debt has quietly become a focus amongst certain economists, and how its in� uence has augmented corporate policy. Cheap � nancing costs has led to companies bloating their balance sheet with the aim of maximising pro� tability. With growth slowing, the potential for lower revenue may lead to debt servicing issues for some companies. For now central bank policy has been largely accommodative, but such stances can change and quickly as we have seen.

* Parish pump politics – the rodeo continuesThe upcoming months see a number of key political themes with the potential to impact markets. First and foremost, the impending trade deal between the US and China will need to be signed. Donald Trump, with one eye on the 2020 elections, will be keen to get this agreement over the line and utilise it as a key message to his voter base that he is the person who will negotiate the best deal for America. With more ammunition at the ready, expect the focus thereafter to be shifted on renegotiating a trade deal with the European Union or getting that wall built be it with Lego or other less colourful materials.

Closer to home, the media scrutiny may � nally pause from the quite Shakespearean play that is Brexit to focus on the European elections, which are due to be held in May. Whether the UK participates at present is unknown – it has gone from no, to de� nitely not, to maybe in the past month alone, but the vote will provide a key reference to the political health of the European Union itself. The European Union has many challenges ahead and could bene� t from a reduction in political in� ghting and polarisation of views.

* Invesco Education Series – Irish Commercial PropertyThe past decade has seen a booming Irish property market as the economic recovery took hold, enticing foreign investment and in turn propelling the domestic property market to new highs. As part of our Q1 2019 Invesco Education Series we have applied a spotlight on Irish Property. If you would like to learn more about this topic and some of the conclusions we came to - please contact your Investment Consultant. We would be happy to forward on the recently completed paper on the topic as part of the Invesco Education Series.