State Street Global Advisors Asia will be replaced as manager of Hong Kong's largest ETF — the Tracker Fund of Hong Kong, or TraHK — after a review by the fund's supervisory committee.
TraHK is the most actively traded ETF in Hong Kong and tracks the Hang Seng index, with assets under management of HK$112.8 billion ($14.4 billion). SSGA was replaced by Hang Seng Investment Management, a subsidiary of Hang Seng Bank, to manage the ETF.
A regulatory filing Tuesday said the fund's supervisory committee engaged a consultant "with expertise in manager selection to conduct a manager review to help the supervisory committee to stay abreast of market developments and the competitiveness of TraHK."
The reason for the manager change was not provided in the filing, but Bloomberg reported that State Street created an outcry in China in January last year when the company said it would avoid making new investments in U.S. sanctioned Chinese companies. The company reversed its position a few days later.
Hang Seng is expected to take over management of the ETF in the third quarter this year, the filing said.
State Street will remain the custodian for the fund, the filing said.
The Hong Kong government created TraHK with State Street in 1999 to dispose of shares acquired when it fought against speculators during the Asian financial crisis, according to Bloomberg.
State Street said in a statement that it is "grateful for our partnership with the Hong Kong Monetary Authority and the Tracker Fund of Hong Kong Supervisory Committee, a collaboration which began over 20 years ago."
Bloomberg contributed to this story.
