Industry Updates

HANetf converts six ETFs to ICSD model

Brexit deadline looming

Tom Eckett

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ETF white-label platform HANetf has migrated six Irish-domiciled ETFs to the International Central Securities Depositary (ICSD) model in preparation for the Brexit deadline.

The ETFs are currently settled via CREST but will move to Euroclear Bank, effective 3 August.

The ETFs set to convert to the ICSD model are:

Introduced in 2013, the ICSD model enables cross-listed ETFs to be settled in one pan-European location.

Previously, each exchange was linked to a regional CSD which led to fragmentation issues for cross-listed ETFs.

In recent times, the move to the ICSD model has been accelerated by the UK’s exit from the European Union in March 2021 as Euroclear UK & Ireland (EUI) will no longer be able to provide central securities depositary (CSD) services for Irish-domiciled ETFs.

According to BNY Mellon, some €61bn of Irish ETP migrations are set to complete by the end of this year leading to 96% of Irish ETPs using some form of the ICSD model.

Along with HANetf, DWS and UBS Asset Management have also shifted to the ICSD model in recent weeks.

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