Industry Updates

LGIM closes four ETFs ending Lombard Odier’s ETF presence

Tom Eckett

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Legal & General Investment Management (LGIM) has shut four fixed income ETFs that were a joint venture with Lombard Odier Investment Management (LOIM), ending the Swiss asset manager’s European ETF presence.

The four ETFs closing are the L&G LOIM Emerging Market Local Government Bond Fundamental UCITS ETF (LOCL), the L&G LOIM Global Government Bond Fundamental UCITS ETF (HCOE), the L&G LOIM Global Corporate Bond Fundamental UCITS ETF (CRGH) and the L&G LOIM Euro Corporate Bond Fundamental UCITS ETF (FWEC).

LGIM said in a statement: “LGIM and LOIM have jointly decided to end their product venture, closing four fixed income ETFs.

“This decision has been carefully considered and is based on what is optimal for our clients’ long term interests.”

LOIM entered the European ETF market in 2015 joining forces with ETF Securities to launch a range of smart beta fixed income ETFs.

However, the decision to close these ETFs comes after LGIM acquired ETF Securities’ Canvas business in March 2018.

Last week, Legal & General said in its interim results the drop in ETF AUM in H1 was due to “the strategic closure of certain funds that were under review following last year’s acquisition”.

The move means LGIM no longer offers any fixed income ETF products however, the firm is planning on launching a number of solutions later this year.

Meanwhile, LOIM has no further plans to team-up with another ETF partner.

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LOCL was the only ETF of the four to attract any significant assets, pulling in £109m since launch in September 2015.

The other three ETFs failed to gather any meaningful interest from investors with all three failing to breach the £20m assets under management (AUM) barrier.

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