Invesco’s Goldie: ‘We will not increase fees’ under T+1 misalignment

Spreads may widen under misaligned settlement cycles

Theo Andrew

Jim Goldie, head of ETF capital markets and indexed solutions, EMEA, at Invesco, has said the asset manager will not raise ETF management fees because of the costs incurred from the US moving to a T+1 settlement cycle.

In a recent webinar, titled ETF Investigations: The Challenges of T+1 Settlement in Europe, Goldie said the shortened settlement cycle in the US will create issues and increase costs for the industry, but that it “will not be a wholesale costly exercise for investors”.

“We are not going to increase costs for investors, we do not look at increasing management fees because there is misalignment between settlement cycles,” Goldie said.

“Because there is a migration project does not mean we will put management fees up, that is not what we do as an asset manager and I do not think many will do from an ETF provider perspective.”

Goldie noted there may be a small increase in spreads to cover funding differentials due to misalignment, but that it will improve once Europe and the UK also move to T+1 settlement.

He said the firm’s global operating capabilities means it will be able to transfer workload from one region to another to manage settlement misalignment between Europe and the US.

“We do not think it will be a huge operational driver for us, we will need to look at operational costs and synergies,” he said.

“There will be operational costs, it is complex and not everyone is a large global asset manager, there will be local players that will have to look at how they resource things operationally.”

Speakers in this webinar include:

  • Jim Goldie, head of ETF capital markets and indexed solutions, EMEA, Invesco

  • François Baratte, senior affairs advisor at ALFI

  • Pablo Garcia, post-trade manager at AFME

ETF Investigations is a new webinar series from ETF Stream which examines the key issues facing ETF investors in Europe. To watch a full replay of this webinar, click here.


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