Credit Suisse ETF sale sparks outflows

ftimesCourtesy of FT’s Madison Marriage


BlackRock’s move to buy Credit Suisse’s exchange traded fund arm has triggered heavy outflows from the unit, experts say.

In January, the US fund house announced it had entered into an agreement to buy Credit Suisse’s ETF business for an undisclosed amount, subject to regulatory approval.

However, Credit Suisse registered $655m (€511m) of outflows from its ETFs over January and February, data from consultancy ETFGI show – the heaviest withdrawals of any ETF provider in Europe during that period.

The redemptions were more than triple the total ETF outflows ($208m) the Swiss company experienced over the entire 2012. Credit Suisse Asset Management has €13.5bn of ETF assets.

Experts say the withdrawals are a result of uncertainty generated by the BlackRock deal, as well as investor demand for provider diversity and declining interest in Credit Suisse’s gold ETFs.

Deborah Fuhr, managing director at ETFGI, says: “[The outflows] are really down to the fact that [Credit Suisse] announced it is selling the business. “Based on the uncertainty of what will happen, people decided not to put more assets in. It is not surprising that they would redeem from these products.”

BlackRock and Credit Suisse both declined to comment on the outflows.

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