According to the announcement, Nuveen will become sub-adviser for municipal bond SPDR exchange traded funds (ETFs) along with other municipal bond investment strategies managed by State Street Global Advisors.
Under the terms of the agreement, Nuveen Asset Management will be responsible for managing the assets of five existing municipal bond SPDR ETFs under oversight of SSgA Funds Management, Inc. (“SSgA FM”) and the Board of Trustees for each SPDR ETF. SSgA FM will continue to serve as the investment adviser for the municipal bond SPDR ETFs.
With nearly $2 billion in assets, SSgA’s municipal bond ETFs will be re-branded as SPDR Nuveen municipal ETFs and include:
- SPDR Barclays Capital Municipal Bond ETF (ticker: TFI);
- SPDR Barclays Capital California Municipal Bond ETF (CXA);
- SPDR Barclays Capital New York Municipal Bond ETF (INY);
- SPDR Barclays Capital Short Term Municipal Bond ETF (SHM);
- SPDR S&P VRDO Municipal Bond ETF (VRD).
The sub-advisory agreement, which has been approved by the Board of Trustees and shareholders for each SPDR ETF, will become effective on April 1, 2010, according to a press release.
To ensure a seamless transition, Tim Ryan, lead portfolio manager of the municipal bond SPDR ETFs and a Unit Head for State Street Global Advisors’ Municipal Bond Group, will transition to Nuveen Asset Management as senior vice president. As of December 31, 2009, Nuveen managed nearly $70 billion in municipal bond securities.
“We are pleased to be teaming up with State Street, the firm that created the first exchange traded fund, to provide investors and investment professionals with precise investment products that combine the advantages of municipal bonds and ETFs,” said Bill Huffman, chief operating officer and co-head of Nuveen Asset Management. “The synergies created by this partnership will benefit investors and create exciting new opportunities for collaboration.”
State Street Global Advisors is one of the largest ETF providers globally with assets under management for SPDR ETFs totaling more than $204 billion as of December 31, 2009.