NBAD and Global Fund sign MoU to launch Exchange-Traded Fund (ETF)
13 April 2010
Listing planned on Abu Dhabi Securities Exchange (ADX)
Abu Dhabi (April 13, 2010): The National Bank of Abu Dhabi (NBAD) and The Global Fund to Fight AIDS, Tuberculosis and Malaria (Global Fund) signed a memorandum of understanding (MoU) to launch an Exchange-Traded Fund (ETF) and list it on the Abu Dhabi Securities Exchange (ADX).
This agreement comes a few weeks after NBAD launched the first ETF in the Gulf Cooperation Council (GCC) region, the NBAD One Share Dow Jones UAE 25 ETF, which was listed on ADX on 25 March, 2010. The document signed follows an MoU between the Global Fund and Dow Jones Indexes last month to explore the creation of a series of indexes that could be licensed as the basis for investible products. It is envisioned that the flagship of this index series would be a blue-chip index to be called the Dow Jones Global Fund 50 Index.
The Global Fund will receive a portion of the license and management fees generated by the ETF for financing programs to fight AIDS, Tuberculosis and Malaria.
“I am proud that NBAD is entering into this collaboration so soon after inaugurating the region’s first ETF,” said Michael Tomalin, the Group Chief Executive of NBAD. “We will be launching this ETF to support an organization with an outstanding track record in financing the fight against the world’s most menacing diseases. This partnership is a direct result of our core corporate values. As a leading financial institution, we are dedicated to good and responsible global citizenship.”
Since its inception in 1968, NBAD has been committed to the service of society. The bank believes that social responsibility is one of the pillars underpinning its success as a responsible financial institution.
NBAD is committed to the economic, social and environmental development of the UAE and the countries in which it operates. The bank makes donations, and lends support to sponsorships, corporate philanthropy, and corporate social responsibility projects. NBAD's community support focuses on health, education, community development, environment, art, music, and sports.
“We are confident that this ETF will meet the asset allocation criteria of institutional investors and will therefore become a top-tier investment vehicle giving the GCC access to a global diversified portfolio of stocks and at the same time the opportunity to do some social good” said Robert Filipp, Head of Innovative Finance at the Global Fund. “This Abu Dhabi-based ETF is an opportunity for institutional investors and foundations to support the life-saving work of the Global Fund”
The Global Fund, based in Geneva, is a unique global public/private partnership dedicated to attracting and disbursing additional resources to prevent and treat HIV/AIDS, tuberculosis and malaria. This partnership between governments, civil society, the private sector and affected communities represents a new approach to international health financing.
Since its creation in 2002, the Global Fund has become the main source of finance for programs to fight AIDS, tuberculosis and malaria, with approved funding of US$ 19.3 billion for more than 572 programs in 144 countries. It provides a quarter of all international financing for AIDS globally, two-thirds for tuberculosis and three quarters for malaria.
Alan Durrant, the Chief Investment Officer of NBAD’s Asset Management Group, said that this will be the second NBAD ETF to give investors the opportunity to gain real time, cost-effective exposure to a broad basket of international equities shares.
“Launching an ETF with the Global Fund further broadens the choice available to investors who want to make a positive impact in the world through their investment,” Durrant said. “NBAD, the Number One Bank in the UAE, has a proud history of being first to market with innovative and socially responsible products that meet the needs of local investors, and we are delighted to once again be at the forefront of development.”
###
About Exchange Traded Funds (ETFs)
An index-tracking Exchange Traded Fund (ETF) is a type of an open-ended investment fund that tracks a specific index, and is listed on a Stock Exchange. ETFs allow investors to gain exposure to a wide range of asset classes, regions and investment themes, through a collective investment scheme which is traded like an equity share.
ETFs are one of the fastest growing products in the investment market; and according to Blackrock, ETF assets exceeded USD$ 1 trillion by the end of 2009, up by 45.7% from USD 711 Billion by the end of 2008.
About NBAD
The National Bank of Abu Dhabi (NBAD), The Number One Bank in UAE, was incorporated in 1968 and is listed on the Abu Dhabi Securities Exchange (ADX).
NBAD is rated senior long term/short term A+/A-1 by Standard and Poor's, Aa3/P1 by Moodys and AA-/F1+ by Fitch giving it one of the strongest combined rating of any Middle Eastern financial institution. Ranked as one of the top 50 safest banks in the world, NBAD currently operates across 13 countries on four continents. NBAD has a network of more than 100 branches and over 330 ATMs to provide banking services to customers all over the UAE .NBAD’s overseas network stretches from Oman, Kuwait, and Bahrain in the G.C.C.; Egypt, Libya, and Sudan in Africa; UK, France, and Switzerland in Europe; Hong Kong and Jordan in Asia to Washington, D.C. in the U.S.A. Overall, NBAD has nearly 50 branches and 60 ATMs outside the UAE. NBAD provides its customers with a wide variety of financial services targeting all segments of the consumer and corporate markets in addition to fund management, brokerage, financial markets, leasing, property management and private banking businesses.