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European fund assets rose 15% in 2006 on inflows, market gains

Europe’s mutual fund assets rose 15% last year as investors added money and markets gained, according to a trade group.

Assets in the industry rose to €7.57 trillion ($9.95 trillion), €980 billion above the figure at the end of 2005, the European Fund and Asset Management Association said in an e-mail today. About 8% of that was due to investor inflows and 7% form rising securities, the Brussels-based group said today.

European funds took in a net €520 billion. Savers in Europe are putting more money away for retirement as governments cut back as longer life expectancies put state pension provisions in danger. The expected lifespan, 66 years for an Englishman born in 1950, is 75 years for one born in 1997, according to the UK’s Office for National Statistics.

Luxembourg is Europe’s largest base for funds, with €1.8 trillion domiciled there, the group said. More money is going into so-called funds of funds that invest in other mutual and hedge funds. (Bloomberg)