iShares lists International ETF on Euronext Amsterdam
First ETF with an international security settlement structure in continental Europe
Previously, cross-border transactions in ETFs settled in multiple national central securities depositories (CSDs) with related re-alignment costs and risks. With this new international security structure, the iShares ETF will be issued and settled for the first time in an International CSD (ICSDs) - in this instance Euroclear Bank, facilitating better cross-border liquidity provision and in parallel reducing operational and trading costs for ETF investment, potentially resulting in growth of the European ETF market.
The newly listed iShares EURO STOXX 50 ex-Financials UCITS ETF is a physically replicating fund which invests in blue chip stocks from 12 eurozone countries, while excluding companies from the financial sector, potentially providing investors with a less volatile exposure to Eurozone equities. The fund has a total expense ratio of 20 basis points.
Pedro Fernandes, Head of European Exchange Traded Products of Euronext, said: "We are very proud to be chosen by iShares as the first exchange in continental Europe to list this innovative international ETF structure exclusively on the newly created ETF Euroclear Bank settlement segment. It reaffirms our position as the leading venue for ETF listing and trading in continental Europe. Adapting the market infrastructure to reflect the pan-European profile of ETFs should provide further operational efficiencies to issuers and liquidity providers, but more importantly improve on-exchange spreads and market depth available to end-investors."
Gert-Jan Verhagen, Head of iShares Netherlands, commented: "iShares is excited to be the first ETF provider to have an international security settlement structure in continental Europe to list on Euronext. We anticipate that this new structure will enable investors to gain easier access to one of the most dynamic markets while benefitting from reduced costs. This will help us in our ambitions to not only grow the market but also to increase market efficiency for our clients."
Mo M'Rabti, Deputy Global Head International Markets, at Euroclear said: "Euroclear is delighted to be an integral part of re-shaping the ETF industry in Europe with BlackRock. The aim of the new international structure is to remove historical post-trade fragmentation and re-alignment complexities inherent to trading ETFs on multiple exchanges. This additional listing on Euronext Amsterdam is proof of multi-listed ETFs trading with seamless and efficient post-trade provision. We expect to lower total ownership costs for ETF investors while, equally importantly, raising settlement efficiency rates which have been sub-optimal, particularly for cross-border flows."
The newly listed ETF follows a succesfull year of new listings on Euronext' ETF market in 2013. Euronext reported a growth in new ETF listings of 76% versus 2012, with a total of 51 listings on its European market totalling to 564 ETFs. In Amsterdam, the growth in new ETFs was up by 223% compared to 2012, totalling to 127 ETFs.
iShares is a global product leader in exchange traded funds with over 600 funds globally across equities, fixed income and commodities, which trade on 20 exchanges worldwide. The iShares Funds are bought and sold like common stocks on securities exchanges. The iShares Funds are attractive to many individual and institutional investors and financial intermediaries because of their relative low cost and trading flexibility. Investors can purchase and sell shares through any brokerage firm, financial advisor, or online broker, and hold the funds in any type of brokerage account. The iShares customer base consists of the institutional segment of pension plans and fund managers, as well as the retail segment of financial advisors and high net worth individuals.
Euronext is the primary exchange in the Euro zone with over 1 300 issuers worth €2.2 trillion in market capitalization, an unmatched blue chip franchise consisting of 20+ issuers in the EURO STOXX 50® benchmark and a strong diverse domestic and international client base.
Euronext operates regulated and transparent equity and derivatives markets. Its total product offering includes Equities, Exchange Traded Funds, Warrants & Certificates, Bonds, Derivatives, Commodities and Indices. Euronext also leverages its expertise of running markets by providing technology and managed services to third parties. Euronext operates regulated markets, Alternext and the Free Market; in addition it offers EnterNext, which facilitates SMEs' access to capital markets.
Euronext is a wholly owned subsidiary of IntercontinentalExchange Group (ICE).
About IntercontinentalExchange Group
IntercontinentalExchange Group (NYSE: ICE) is the leading network of regulated exchanges and clearing houses for financial and commodity markets. ICE delivers transparent, reliable and accessible data, technology and risk management services to markets around the world through its portfolio of exchanges, including the New York Stock Exchange, ICE Futures, Liffe and Euronext.
Trademarks of ICE and/or its affiliates include IntercontinentalExchange, ICE, ICE block design, NYSE Euronext, NYSE, New York Stock Exchange, LIFFE and Euronext. Information regarding additional trademarks and intellectual property rights of IntercontinentalExchange Group, Inc. and/or its affiliates is located at https://www.theice.com/terms.jhtml and http://www.nyx.com/terms-use.
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Euroclear UK & Ireland
Euroclear Bank provides settlement and related securities services for cross-border transactions involving domestic and international bonds, equities, derivatives and investment funds. Serving major financial institutions located in more than 90 countries, Euroclear Bank, based in Brussels, is part of the Euroclear group. Euroclear Bank is rated AA+ by Fitch Ratings and AA by Standard & Poor's.
Euroclear is the world's largest provider of domestic and cross-border settlement and related services for bond, equity, derivatives and fund transactions. The Euroclear group includes Euroclear Bank, based in Brussels, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden and Euroclear UK & Ireland. The Euroclear group settled the equivalent of EUR 572 trillion in securities transactions in 2013, representing 170 million domestic and cross-border transactions, and held almost EUR 24.2 trillion in assets for clients. For more information, please visit www.euroclear.com