Greater than 300% growth in unsponsored ADR programs driving expanded investment options; BNY Mellon DR Indices now primary benchmark for 19 ETF funds
NEW YORK, August 15, 2011 — BNY Mellon, the global leader in investment management and investment services, announced that the BNY Mellon Composite Depositary Receipt Index(SM) grew to 1,025 constituent depositary receipts (DRs) for issuers from 49 countries as of June 30, 2011 – an increase in coverage of more than 20% since the index was created in October 2009.
The rise in DRs in the BNY Mellon Composite DR Index is due mainly to the rapid growth of 'unsponsored' ADRs. Unsponsored ADRs are issued by one or more depositary banks in response to market demand but without a formal agreement with the underlying issuer, while sponsored ADRs are issued by a single depositary appointed by the issuer. Unsponsored ADRs generally trade over-the-counter (OTC), while sponsored ADRs trade either on the OTC market or on major U.S. stock exchanges.
The BNY Mellon Classic ADR Index (a subset of the Composite DR Index) illustrates the point. On its launch in February 2009, it was comprised of 60 unsponsored and 590 sponsored ADRs. By June 2011, the number of unsponsored programs had quadrupled to 249, while sponsored ADRs rose 20% to 699.
"The growing acceptance and use of unsponsored ADRs allows us to satisfy investors' diversification demands, and that's reflected in the greater breadth of country and regional coverage provided by BNY Mellon's family of DR indices," said Michael Cole-Fontayn, CEO of BNY Mellon's Depositary Receipts business.
"Index licenses are up more than 30% year-to-date, and our DR indices are now the primary benchmark for 19 ETF products," said Michael Finck, BNY Mellon's DR head of global service delivery. "As the number of DRs in our indices increase, we're able to offer investors convenient, cost-effective access to even more international investment choices."
The BNY Mellon Composite DR Index provides the most comprehensive definition of the DR market, recognizing the three primary trading locations: U.S. listed exchanges, London Stock Exchange IOB Market, and the U.S. OTC Market. The Composite DR Index is the "umbrella index" for the company's four DR Index families representing more than 140 indices:
- BNY Mellon ADR Index(SM) – tracks all ADRs traded on the NYSE, NYSE Amex and NASDAQ
- BNY Mellon GDR Index(SM) – tracks all GDRs traded on the LSE
- BNY Mellon DR Index(SM) – tracks a combination of the ADR Index and GDR Index
- BNY Mellon Classic ADR Index(SM) - tracks all ADRs traded on NYSE, NYSE Amex, NASDAQ and OTC
The BNY Mellon Composite DR Index is capitalization-weighted and adjusted for free-float using Dow Jones Indexes' current methodology.
BNY Mellon DR Indices provide a broad range of index solutions for DR investors, including Market Select, Custom Global (combining local shares with DRs) and Currency Hedged calculations. BNY Mellon has been serving the index investor community for over 10 years. For more information on our DR Indices, go to www.bnymellondrindex.com.
BNY Mellon acts as depositary for more than 2,100 American and global depositary receipt programs, acting in partnership with leading companies from 67 countries. With an unrivaled commitment to helping securities issuers succeed in the world's rapidly evolving financial markets, the company delivers the industry's most comprehensive suite of integrated depositary receipt, corporate trust and stock transfer services. Learn more at www.bnymellon.com/dr.
BNY Mellon is a global financial services company focused on helping clients manage and service their financial assets, operating in 36 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, offering superior investment management and investment services through a worldwide client-focused team. It has $26.3 trillion in assets under custody and administration and $1.3 trillion in assets under management, services $11.8 trillion in outstanding debt and processes global payments averaging $1.7 trillion per day. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Learn more at www.bnymellon.com and through Twitter @bnymellon.
This release is for informational purposes only. BNY Mellon provides no advice nor recommendation or endorsement with respect to any company or securities. Nothing herein shall be deemed to constitute an offer to sell or a solicitation of an offer to buy securities. Depositary Receipts: Not FDIC, State or Federal Agency Insured; May Lose Value; No Bank, State or Federal Agency Guarantee.