Industry Updates

Amundi to merge US equity ETF into Irish equivalent

The firm continues to shift its SICAV range to Ireland

Lauren Gibbons

USA flag

Amundi is set to merge its Luxembourg-domiciled US equity ETF into an Irish equivalent as it continues to target investors looking to benefit from Ireland's favourable US tax treaty.

The French asset manager announced last September that it would be duplicating its $347m Amundi Prime USA UCITS ETF (PR1U) to allow for Irish tax benefits.

However, Europe's largest asset manager is now set to fully merge the ETF on 6 March.

The ETF, which has a total expense ratio (TER) of 0.05%, tracks the Solactive GBS United States Large & Mid Cap index which offers exposure to 482 US large and mid-cap companies.

The French asset manager will look to reap the benefits of the Ireland-US double taxation treaty, which means that Irish-domiciled US equity ETFs are subject to a 15% withholding tax on dividends, rather than 30% in Luxembourg and other jurisdictions.

Ireland has jumped from 199 exchange-traded products (ETPs) with $305bn assets under management (AUM) in 2017 to 2,722 ETPs and $1.1trn AUM by October 2023, significantly outstripping Luxembourg's 1,364 ETPs and $305m AUM.

Recent EY research suggests the Irish ETF market could top $3trn by 2030.

Amundi started domiciling ETFs in Ireland last May while its French rival BNP Paribas Asset Management listed its first ETF – the BNP Paribas Easy S&P 500 ESG UCITS ETF (SPEEU) – on its ICAV platform in June last year.

The move follows Amundi's regulatory approval from the Central Bank of Ireland (CBI) last March, allowing it to launch several US equity ETFs previously based in Luxembourg.

Following the approval, Amundi has since switched several ETFs into Irish-domiciled equivalents, including the €4.9bn Amundi Index MSCI World SRI PAB UCITS ETF (WSRI), and the €4bn Amundi S&P 500 ESG UCITS ETF (S500).

Last week, the French asset manager closed four ETFs last week tracking European and US equities amid low assets under management (AUM).

Featured in this article

Logo for AmundiLogo for BNP Paribas Asset Management