The combining of the two functions enables the newly unified client-facing team to adopt a holistic solution-based approach in its delivery of BlackRock’s diverse platform and global capabilities to clients. These efforts will be led by three long-tenured leaders within the Australian client-facing team.

Chantal Giles has been appointed to an expanded role of Head of iShares Wealth (iSW) Australasia, leading a broad team responsible for the distribution of BlackRock’s alpha-seeking strategies, index and iShares ETF offerings, as well as whole portfolio services to our wealth management, bank and platform clients in the region.

From July 1, James Kingston will take on the role of Head of iShares Australasia, in addition to his responsibility as Head of APAC Portfolio Analysis & Solutions (BPAS). James will continue to lead the APAC BPAS team to help clients build multi-asset outcome-focused solutions that match their desired long-term objectives, as well as drive the iShares strategy locally.

Christian Obrist who has held the role of Head of iShares Australasia for three successful years has been promoted to lead iShares Distribution Asia ex-Japan based in Hong Kong.

Meanwhile, Eleanor Menniti will assume the newly created role of Head of Client Product Strategy and Consultant Relations, leading the distribution strategy behind the design and delivery of BlackRock’s full set of product capabilities and solutions to the Australian wealth market, as well as managing a team responsible for key relationships with retail asset consultants and research houses.

Jason Collins, Head of Client Business Australasia, said: “As we evolve our business to reflect changing market dynamics and client needs, we are pleased to be able to promote from within and expand the roles of our senior leaders to deliver bespoke solutions to our clients.

“Our ability to work with clients across a range of investment types – index, active, multi-asset and alternatives – and deliver this via various structures, gives BlackRock a unique ability to partner with firms as they seek to curate and provide leading investment options to their end clients.

Rimmo Jolly, Head of iShares Asia Pacific, said: “It’s exciting to see clients across the region increasingly turning to BlackRock to be their partner of choice for iShares ETFs as portfolio building blocks and whole portfolio solutions.

“We are focused on evolving the delivery of our iShares platform to better meet client needs and look forward to engaging more deeply with clients in Australia.”

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Christian Obrist

iShares has listed two fixed income ETFs – iShares Yield Plus ETF (Ticker: IYLD) and iShares Core Corporate Bond ETF (Ticker: ICOR) – on the ASX to provide Australian investors a low-cost access point to a diversified portfolio of high-quality Australian investment grade corporate bonds. The addition of the two funds complements the broader iShares fixed income ETF suite, offering Australian investors increased flexibility to optimise fixed income allocations in portfolios.

The iShares Yield Plus ETF seeks to produce stable, predictable returns to meet investors’ demand for capital preservation and liquidity while maximising yield. At the same time, the fund offers investors portfolio diversification benefits, through the exclusion of Australia’s major banks, implemented via a highly diversified portfolio of securities. It carries a 0.12% per annum management fee and targets a 0.75%-1.0% yield margin over the RBA cash rate, replicating the performance of its customised benchmark, the BACCREX4. The Fund provides monthly distribution payments and provides for daily liquidity.

The iShares Core Corporate Bond ETF, benchmarked to the Bloomberg AusBond Credit 0+ Yr Index, seeks to provide an attractive, reliable income stream for fee-conscious investors. The fund carries a 0.15% per annum management fee and gives investors the opportunity to tap into stable income from a highly diversified portfolio of high-quality Australian corporate bonds.

Applying BlackRock’s baseline screens, both funds explicitly exclude issuers involved in controversial weapons, civilian firearms, fossil fuels, tobacco and UN compact violators. The screens are reviewed on an annual basis to ensure continued relevance as investors’ needs evolve over time.

Christian Obrist, Head of iShares, Australasia said:“During periods of heightened market volatility, we have seen Australian investors deepen their usage of fixed income ETFs as key building blocks to construct resilient portfolios, whether it is for income generation, capital preservation, or as diversification from equities.

“We’re excited to add iShares Yield Plus ETF and iShares Core Corporate Bond ETF to our existing fixed income ETF suite, particularly in the current backdrop of ultra-low interest rates and reduced equity dividends. We believe investors are set to benefit from the broadening of cost-effective, liquid investment choices in our ETF product range as the two funds aim to meet investors’ demand for diversified sources of income.

iShares rounds out fixed income ETF suite in Australia Launches iShares Yield Plus ETF and iShares Core Corporate Bond ETF Expanding liquid, transparent income-focused solutions for Australian advisers and retail investors  “Designed with investors’ needs in mind, both funds aim to provide attractive, stable income streams via exposure to a diversified portfolio of high-quality Australian investment grade corporate bonds. Investors will also benefit from investing in institutional quality ETFs that meet daily liquidity and transparency demands.”

Pioneered by iShares in 2002, fixed income ETFs empower all types of investors to build robust portfolios to meet their investment objectives such as income and portfolio diversification as well as capital preservation. Investors have increasingly turned to fixed income ETFs for their rich diversity of exposures and good value. In 2019, fixed income ETFs eclipsed $1 trillion USD globally1 with iShares fixed income ETFs accounting for over 47% of these assets at year end and $112 billion USD in flows. In Australia, fixed income ETFs assets surpassed $8 billion AUD as at 30 April 20202 , and the iShares Core Composite Bond ETF (Ticker: IAF) continues to see strong interest with over $100 million AUD inflows year to date, as at 26 May 2020.

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[1] iShares flows and AUM figures sourced by BlackRock as of December 31, 2019. Industry data is captured from a number of sour ces by BlackRock, including provider websites, fund prospectuses, provider press releases, provider surveys, Bloomberg, the National Stock Exchange, Strategic Insight Simfund, and Wind. Flows are derived using daily net asset values and shares outstanding using the most recent data we can capture at month-end. iShares ETFs saw global net inflows of $184.644bn in 2019.
[2] Data from ASX landscape report: https://www.asx.com.au/documents/products/ASX_Investment_Products_April_2020.pdf

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Christian Obrist

Bond ETFs are transforming how Australian investors access fixed income markets by bringing convenience and transparency to a historically hard-to-access asset class. At BlackRock, we see investors increasingly turning to fixed income ETFs for their rich diversity of exposures and good value.

In June 2019, bond ETF assets topped $1 trillion USD globally. In Australia, fixed income ETFs assets surpassed $5 billion AUD in September 2019, and the iShares Core Composite Bond ETF (ticker IAF) assets doubled in less than two years to surpass $1 billion AUD. Overall assets in iShares fixed income and cash ETFs doubled from $1 billion to $2 billion AUD in the last 12 months.

We see bond ETFs as a game-changing technology. Their straightforward format—an ETF is bought and sold on exchange—lets investors manage diversified bond holdings simply and efficiently. Pioneered by iShares in 2002, fixed income ETFs empower modern investors around the world to build robust portfolios to meet their investment objectives, including income and portfolio diversification.

Christian Obrist, Head of iShares, Australia, commented: “Investors are allocating to fixed income ETFs to provide ballast to their portfolios given falling cash rates and an uncertain macro backdrop. Doubling assets in less than two years, our flagship investment grade Australian bond ETF, IAF, has subsequently surpassed the significant $1 billion AUM threshold.”

Christian continued: “BlackRock forecasts global bond ETF assets to double to US $2 trillion by 2024 from US$1 trillion today driven by secular trends. Whilst global in nature, these trends – most notably the focus on portfolio construction – are playing out in Australia too.”

The next leg of growth will be driven by investors finding novel uses for these versatile tools. Individual savers will increasingly use bond ETFs to help generate income; asset managers, including BlackRock, will add them to strategies designed to beat their benchmarks; and asset owners such as pension funds will continue to rely on the greater liquidity and lower costs to execute complex portfolio strategies.

Additionally, powerful advances in technology, market structure and product innovation will continue to accelerate the bond ETF market and lead more investors to bond ETFs. We believe all investors stand to benefit.

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Christian Obrist

In a year plagued with market volatility risks, investors have continued to look to exchanged-traded funds (ETFs) to access liquidity and diversify risk. According to Christian Obrist, Head of iShares Australasia, Australia’s ETF growth has not only been driven by investors’ desire for exposure to global equities, but also the desire for exposure to bonds, which reached a milestone US$1 trillion global AUM in June 2019.

Christian said: “It took nearly two decades for bond ETFs to surpass $US1 trillion in global assets, however, I believe the next leg of growth will be swifter. ETFs bring convenience and transparency to a historically hard-to-navigate asset class and bond ETFs have transformed how investors can access fixed income by providing precision and transparency. At iShares, we see a tremendous runway for the growth of bond ETFs.”

Global bond ETF assets are currently growing at 20% annually, five times the rate of other open-end bond funds.^[1] Yet even at US$1 trillion, bond ETF assets represent less than 1% of the US$105 trillion global fixed income marketplace. ^[2]

“Global bond ETF assets are well positioned to double to US$2 trillion by 2024. Investors are increasingly looking for alternative investment options to act as a shock absorber to their portfolios during periods of market volatility,” said Christian.

Commenting on Australian investors’ adoption of bond ETFs, Christian said: “Following the recent cash rate cut and the RBA signalling further cuts this year, we can expect term deposit rates will continue to dwindle. This makes bond ETFs an attractive option for individuals who currently have lazy cash sitting in bank savings accounts that could be potentially earning a higher return.”

Christian concluded: “Investors have realised bond ETFs are an efficient way to access different sources of return and manage risk. Individuals can use bond ETFs to help generate predictable income through laddering while professional portfolio managers can use high-yield bond ETFs alongside individual securities in actively managed funds.^[3] Hedge funds can use ETFs for targeted long and short positions. In all cases, bond ETFs make it easy to build and manage fixed income allocations.”

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