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Isabelle Bourcier, BNP Paribas

BNP Paribas sees ETF assets grow

Isabelle Bourcier is Global Head of Quantitative and Index at BNP Paribas Asset Management (BNPP AM), having arrived in June 2016 to grow the ETF and Index franchise BNP Paribas Easy.

BNP Paribas ETF assets now stand at USD10.4 billion and have been, as she puts it, ‘going up nicely’.

“We are growing as a team, as well as in terms of assets managed,” she says. “We have recruited a number of sales people to grow our franchise.”

BNP Paribas’s sales footprint extends across offices in France, Italy and Germany. The French market includes Belgium, Luxembourg and the French-speaking Swiss market; the German office in Munich covers Germany, German-speaking Switzerland and Austria while the Italian office in Milan covers Italy and is making forays into Spain.

The focus has largely been on smart beta and factor-based products, but Bourcier reports that appetite remains strong for products on the ESG and SRI side.

“Firms like us with large distribution capability will going forward change the distribution of the market shares of the European ETF industry,” she says. “We see a lot of demand on the distribution side for ESG products, including from discretionary fund managers who are building ESG offerings and need the geographical allocation building blocks with ESG and SRI status.”

Because of that BNP Paribas is planning to add in March a number of new SRI ETFs offering exposure to Europe and Japan. The firm already manages EUR735 million in three ETFs tracking the MSCI KLD 400, MSCI Emerging SRI and Low Carbon 100 indices (source Bloomberg as at 9 February 2018).

Commenting on the market volatility that happened in early February, Bourcier says: “ETF volume is higher when there is a spike in volatility. This is general to all ETFs. Our role is to replicate what the market is doing – thus to be as close as possible to the indices we replicate. We are not active managers.”

BNP Paribas offers a low volatility ETF which is invested on a long-only basis into a basket of equity securities that have specifically shown that they have had the lowest volatility for the last three years so they experienced no impact from the short term volatility moves.

“We are trying to offer something different in terms of the focus of our product range,” Bourcier says. “We are trying not to go into over-crowded spaces and are being very careful in developing products that have meaning for our clients.”

Their clients are drawn from insurance companies, pension funds and asset managers, who are attracted to the quality of the brand, Bourcier says. “For a number of countries, it is very important that we offer diversification across the whole ETF sector and in supplying services. We have a strong offering, good pricing and something new to present to them.”

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