The Treasury Funds launched by HSH Nordbank can now be traded. Following a six-month pre-sales phase, current quotes for the V3, V6 and V9 Treasury Funds can be viewed on Bloomberg.
The Treasury Funds are primarily targeted at small and medium-sized cooperative banks and savings banks. For the first time, these funds allow the banks to use a fund solution to compensate for earnings fluctuations and risks in their loan and deposit books. Depending on the balance sheet structure of a bank, the use of the Treasury Funds increases the total bank result and stabilises it through a reduction in volatility. "A calculation over the past five years shows that the return on equity of a typical regional bank can be increased by up to one percentage point while the total bank risk remains virtually the same," explains Dr. Michael Kuhlen, Head of Portfolio Advisory at HSH Financial Markets Advisory. The Treasury Funds are designed in such a way that they show a particularly strong performance whenever loan losses increase or income from the difference between short-term and long-term interest rates, i.e. maturity transformation, decline because of a flat yield curve.
The Treasury Funds primarily invest in Exchange Traded Funds (ETFs), which results in a favourable cost structure and a high level of transparency. The investment strategy in the three Treasury Funds is geared to the respective credit risks of the banks. The V3 Treasury Fund (ISIN LU0326796330) is designed for banks with low credit risks, while the V6 Treasury Fund (ISIN LU0326818241) and the V9 Treasury Fund (ISIN LU326818753) are designed for banks with medium and high credit risks, respectively. All funds can be combined with each other to achieve the ideal allocation of assets.
HSH Asset Management S.A. is responsible for consulting and distribution of the funds, while HSH Financial Markets Advisory S.A. acts as fund advisor. Both companies are members of the HSH Nordbank Group.
The Treasury Funds are primarily targeted at small and medium-sized cooperative banks and savings banks. For the first time, these funds allow the banks to use a fund solution to compensate for earnings fluctuations and risks in their loan and deposit books. Depending on the balance sheet structure of a bank, the use of the Treasury Funds increases the total bank result and stabilises it through a reduction in volatility. "A calculation over the past five years shows that the return on equity of a typical regional bank can be increased by up to one percentage point while the total bank risk remains virtually the same," explains Dr. Michael Kuhlen, Head of Portfolio Advisory at HSH Financial Markets Advisory. The Treasury Funds are designed in such a way that they show a particularly strong performance whenever loan losses increase or income from the difference between short-term and long-term interest rates, i.e. maturity transformation, decline because of a flat yield curve.
The Treasury Funds primarily invest in Exchange Traded Funds (ETFs), which results in a favourable cost structure and a high level of transparency. The investment strategy in the three Treasury Funds is geared to the respective credit risks of the banks. The V3 Treasury Fund (ISIN LU0326796330) is designed for banks with low credit risks, while the V6 Treasury Fund (ISIN LU0326818241) and the V9 Treasury Fund (ISIN LU326818753) are designed for banks with medium and high credit risks, respectively. All funds can be combined with each other to achieve the ideal allocation of assets.
HSH Asset Management S.A. is responsible for consulting and distribution of the funds, while HSH Financial Markets Advisory S.A. acts as fund advisor. Both companies are members of the HSH Nordbank Group.
