BBVA is delisting two further Spanish ETFs as part of a dramatic overhaul of its product range in the country.
The decision to liquidate the Acción Ibex 35 Inverso ETF and Acción FTSE Latibex Brasil ETF means the issuer has now cut 70 percent of its Spanish ETFs over the past six months.
A BBVA spokesperson said the firm had been undertaking a review of its Spanish ETFs. “BBVA Asset Management has been checking its range of ETFs in Spain to determine which products attract investors’ demand and which don’t. The same exercise is done periodically with all the range of funds of BBVA AM, and those funds with no demand are liquidated.
“In the case of ETFs, this rationalisation of the range has concluded with the liquidation of seven funds.”
BBVA now has just three ETFs listed in Spain: the Acción Ibex 35 ETF, the Acción Euro Stoxx 50 ETF and the AFI Bonos Medio Plazo Euro ETF.
Despite the scale of BBVA’s withdrawal from the market, Pablo Ybarra, of the equity unit at Bolsas y Mercados Españoles, which operates Spain’s stock markets, said he did not predict other issuers would follow suit.
“There is activity in the market in terms of new listings. We have two other issuers at the moment—Lyxor and Deutsche Bank—and in December last year Deutsche Bank issued a new ETF on the Ibex 35 and cross-listed five ETFs on other European and US indices. Lyxor has also recently issued a couple of new ETFs primarily on our exchange. These are based on strategy indices of the Ibex 35, double leverage and double short versions.”
Two of the delisted BBVA ETFs were based on the Ibex 35, so it is possible the increased competition from Lyxor and Deutsche were partly to blame for the lack of investor demand for BBVA’s products. Two of the other abandoned funds tracked Latin American indices, two followed European sovereign indices and one was based on the FTSE4Good Ibex index. According to Ybarra, these are outside the main area of investors’ interests in Spain.
“The ETFs that gather most of the activity in terms of the number of trades are usually those based on the main national indices or some of the pan-European indices like the Euro Stoxx 50. Retail investors, who are very active in the Spanish market, are especially focused on ETFs based on domestic indices, including the leveraged and short versions of the Ibex 35.”
BBVA’s pullback from the Spanish market could also be a sign it plans to focus its attention elsewhere: it has been increasing its activity in Latin America, particularly Mexico, recently.
“BBVA Asset Management is not planning to abandon the ETF business, but just adapting its supply to the actual demand in the geographies where the asset manager is present,” said the spokesperson. “In Mexico, for example, BBVA has six ETFs listed on the local stock exchange, where ETFs are attracting investors demand.”