Exchange-traded fund providers have had a bumper year in Europe in 2019 and UBS was one of the frontrunners in the industry. This may prompt others to follow suit.
Blackrock, the biggest wealth manager, generated almost $60 billion with its exchange-traded funds (ETFs) in Europe alone last year. This is almost two-and-a-half times as much as it received in 2018 and has helped iShares, the index-fund unit of Blackrock, to consolidate its lead over rivals.
Surprise Runner-Up
Rivals have also successfully generated new funds with their passive products in 2019, according to U.K.-based «Financial News» (behind paywall), citing analysts at ETFGI and Morningstar. The industry has reached beyond the $1 trillion mark in assets under management.
UBS came a surprise second in the ranking of «Financial News», generating almost $16 billion in Europe with its ETF product range.
HSBC on the Move
Considering that UBS’ asset management has struggled to grow for a number of years, the success of 2019 is pretty impressive. It will also act as a damper on speculation that the bank may want to divest the unit. In the third quarter of 2019 (the last figures currently available), UBS asset management generated a pretax profit of $135 million, up 6 percent from a year earlier.
The ETF-bonanza of 2019 has not gone unnoticed with rivals of the big ETF-firms. HSBC decided to boost its business development team by 15 people and plans to issue new sustainable and bond products, «Financial News» said.
An ETF-Return by Credit Suisse?
Deutsche Bank and its funds unit DWS will also want to remain one of the top providers in Europe, with its x-trackers already among the leading product family.
In Switzerland, UBS may be about to get a resurgent rival as Credit Suisse considers launching its own ETFs again, as Michel Degen, its head of Europe, told finews.com. In 2013, Credit Suisse had sold the ETF business to Blackrock. The time may have come to reconsider and launch new products in 2020.
