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Wednesday, July 11, 2012

Brown Brothers Has High Hopes for Vanguard's European ETFs

Reported by Irene Park

Executives at Brown Brothers Harriman are hoping that Vanguard repeats its success in the U.S. with its just floated ETFs in London. The five ETFs launched last month and are the Valley Forge crews' first-ever European exchange-traded funds.

"Obviously, Vanguard has attracted assets — they're currently the third largest asset manager in the world — so we're very optimistic that they're going to be able to attract assets in Europe just as they have been able to in the U.S. market," said Shawn McNinch, head of global BBH's ETF services business.

"[ETFs are] a strategic area that we're continuing to invest in, and BBH is optimistic about the prospects of ETFs," he added.

BBH will provide global custody, fund accounting and administration, and transfer agency ETFs services to support the new ETFs, which are domiciled in Dublin but trade on the London stock exchange. The investor services firm already provides custody services for a little over $100 billion worth of Vanguard's U.S. ETF business.

Vanguard executives could not immediately be reached for comment.

Vanguard's initial launch of the funds on May 23 included five ETFs:
  • Vanguard FTSE 100 ETF
  • Vanguard S&P 500 ETF
  • Vanguard FTSE All-World ETF
  • Vanguard FTSE Emerging Markets ETF
  • Vanguard UK Government Bond ETF

BBH has previously launched products with XACT and Pimco in Europe.


Brown Brothers Harriman Supports Vanguard's First Exchange-Traded Fund Entry Into Europe

New York, July 10, 2012 – Brown Brothers Harriman (BBH) is pleased to announce the successful London Stock Exchange listing, and launch, of Vanguard’s European Exchange-Traded Funds (ETFs) on May 23, 2012. Vanguard is one of the fastest growing ETF companies globally, and currently ranks #3 with more than $200 billion in ETF assets under management [Blackrock ETF Landscape, May 2012].

"This is a strategic extension of BBH’s partnership with Vanguard. BBH has a long-standing relationship with Vanguard, servicing their ETF business, and we are delighted to broaden this relationship globally by supporting their first launch into Europe," said Seán Páircéir, Partner in charge of Funds and Asset Managers at BBH. "This is an important expansion of our ETF-servicing business, and will strongly position us with many of the leading European and global ETF sponsors."

Vanguard's initial launch included five ETFs:
  • Vanguard FTSE 100 ETF
  • Vanguard S&P 500 ETF
  • Vanguard FTSE All-World ETF
  • Vanguard FTSE Emerging Markets ETF
  • Vanguard UK Government Bond ETF

Today, BBH provides custody services for Vanguard’s U.S. ETF business. Going forward, BBH will provide global custody, fund accounting and administration, as well as transfer agency ETFs services, in support of the new product offerings. “This successful ETF launch is the result of a comprehensive team effort between Vanguard and BBH,” said Shawn McNinch, BBH’s Global Head of ETF Servicing, “In addition, our endeavor represents the first roll-out of APEX™, the Authorized Participant Exchange, a component of BBH’s new web platform for its ETF servicing business.” APEX supports Authorized Participants (APs) creation / redemption order processing including automation of workflow between APs, ETF sponsors and BBH.

About Brown Brothers Harriman Investor Services

BBH’s Investor Services business provides cross-border custody, accounting, administration, and execution services in close to 100 markets for many of the world’s leading asset managers and financial institutions. With approximately $3.2 trillion in assets under custody and administration [as of December 31, 2011], BBH is consistently ranked among the world's top global custodians, asset administrators, foreign exchange, and securities lending providers [as measured by results in major industry surveys. Please see http://www.bbh.com/accolades for a comprehensive listing of recent industry accolades]. BBH operates a global business with seventeen locations, including Beijing, Boston, Charlotte, Chicago, Denver, Dublin, Grand Cayman, Hong Kong, Kraków, London, Luxembourg, New Jersey, New York, Philadelphia, Tokyo, Wilmington and Zürich.

About BBH ETF Services

BBH’s is a leading provider of asset servicing for the global ETF market. With more than $120 billion in ETF assets under custody, BBH works with a diverse cadre of asset managers to introduce products both within their own regions and globally. BBH’s expertise in global custody, transfer agency, administration and accounting services is the foundation of its ETF-specific services. Our services extend across the entire realm of physical (in specie) and synthetic ETF and Exchange Traded Product structures, utilizing active, passive and quantitative strategies.

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