State Street Global Advisors (SSgA) has offered ‘non-lending’ equivalent trusts to four of the thirteen trusts which experienced difficulties relating to the liquidation of securities lending collateral.
SSgA’s Wealth Weighted Global EquityTrust, International Equities Index Trust, Global Index Plus Trust and Global Fixed Income Index Trust are each now being offered in a ‘lending’ and ‘non-lending’ version. These four had been chosen based on initial client feedback and demand for a non-lending option to which to transfer assets, an SSgA spokesperson said, with more non-lending trusts being considered as required.
The investment objectives of the two versions are identical, and the non-lending trusts have been seeded by allocating up to 15 per cent of the NAV of their equivalent lending trust.
The spokesperson said that because there had been no changes to the terms and conditions of the existing trusts, no client consent was required.
“Seeding was constructed in such a way as to ensure that the new funds had adequate critical mass without requiring changes to the existing funds.”
Trust structures via which clients can have their less-liquid collateral assets managed down in an orderly fashion were now up and running, the spokesperson added.