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HSBC Moves ETFs Into Asset Management
By Staff | 16 May, 2012

HSBC has become the latest bank to restructure its European exchange-traded business so the product line now falls under the remit of its asset management division.

The move follows similar developments at Deutsche Bank and Credit Suisse, which both shifted responsibility for their ETF range into asset management.

HSBC launched its range of European ETFs in August 2009, but these were previously managed by the global markets division.

According to the bank, the restructure reflects the fact it is now concentrating on growing its ETF assets under management, rather than developing products.

“Since 2009, when the ETF business launched, the focus, naturally has been on building the platform. As the range can be considered to be generally complete, the focus now is on growing the business and assets under management,” said Andy Clark, head of wholesale, EMEA, at HSBC Global Asset Management.

“The changes which took place reflect the fact the core suite of products (consisting of 25 physically-replicated ETFs that cover the major developed and emerging markets) has now been rolled out, and the business has moved into its next phase. The focus of the initiative has now shifted to growing assets from the current level of US$2 billion.”

While ETF sales, product development and marketing have all been transferred into the asset management division, market making and pricing will continue to fall under the purview of global markets.

The move by one of Europe’s smaller ETF players—HSBC accounted for just 0.7 percent of assets under management in the European ETF market at the end of April, according to ETFGI—mirrors that of one of Europe’s largest ETF issuers.

Deutsche Bank’s db X-trackers, which is the second largest European ETF issuer and has a 14.8 percent share of the market, has also restructured its ETF business so that it falls under a newly-created asset and wealth management division.

The ETF business was transferred along with Michele Faissola, who headed up Deutsche Bank’s global rates and commodities division and who was responsible for the development of the db X-trackers brand.

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