Industry Updates

Waystone enters white-label ETF market in Europe with heavyweight hires

European white labelling market heats up

Theo Andrew

a couple of men smiling for the camera

Financial services company Waystone has entered the increasingly competitive white-label ETF market in Europe after announcing two heavyweight hires as it looks to offer a full suite of ETF solutions for the asset management industry, ETF Stream can reveal.

Waystone ETFs, which will be led by CEO Paul Heffernan (pictured right), will primarily look to offer white-labelling solutions, as well as customised standalone platforms for asset managers looking to enter the European ETF industry.

The business will also provide broader ETF solutions including governance risk and compliance services.

In terms of its future product offering, Waystone ETFs said it would look to appeal to active managers that are yet to enter the ETF space but have realised they “have to get into the game”.

Speaking to ETF Stream, Heffernan said: “We believe our product structuring capabilities can lend itself to bring in some of those active strategies to market that may or may not fit into mutual fund conversions.

“We see the trends that are coming out in the US and we expect those trends to follow into Europe. We will appeal to the large institutional asset managers that want to benefit from our ETF experience and enter the market in a low-cost way to by leveraging the Waystone ETF infrastructure.”

While fully transparent active ETFs are currently a feature of the European ETF market, International Organisation of Securities Commissions (IOSCO) recently stated in its ETF Good Practices report that portfolio transparency can be achieved in different ways, signalling non-transparent ETFs could have a future in the space.

“Waystone ETFs will be at the forefront of these developments with clients,” Heffernan added.

He said a realistic timeframe for its first product launch will be the end of 2022 or Q1 2023.

The Dublin-based firm, which already offers fund hosting solutions across the asset management industry supporting over $100bn in assets, said it will leverage its current regulatory permissions and distribution licenses in a bid to fast-track its ETF offering.

Heffernan, who joined earlier this month from HSBC where he was head of business development for EMEA, will be responsible for building out the white-label platform alongside the newly appointed head of ETF capital markets and distribution Henry Glynn (pictured left).

Heffernan said the Waystone ETF platform will be finished later this year with several interested clients already in the pipeline.

Glynn joined from ICE Data Services where he was head of index and analytics sales for EMEA. He has over 15 years of experience in the ETF industry, having previously built and led the capital markets team in Europe for VanEck.

Heffernan added the group is seeing demand from institutional clients, stating there was an "incredible amount of runway" in the European ETF market with strong tailwinds globally. 

"There are plenty of fish in the sea for white labellers to go after," he said. "Competition is welcome in the industry and it gives asset managers, private banks and insurance companies a choice."

The arrival of Waystone comes at a transformative moment for the European white-labelling market. Although white labelling has existed for some time in European ETFs, the only true one-stop-shop for white label ETF issuance in recent years has been HANetf.

White-label issuers in Europe quietly tripled in a week

Last month, Leverage Shares entered the European white labelling space with the Kronos Strategy ETP (KRON) while crypto issuer Iconic Funds announced its white labelling ambitions on 15 June.

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