December 13, 2011

Three Years After SEC Rule Change, BNY Mellon Sees Six-Fold Rise in Unsponsored Depositary Receipt Programs

Unsponsored DRs for nearly 1,200 firms worldwide estimated at $12 billion in market value; Nearly all major global market index constituents tradable in DR form

NEW YORK, December 13, 2011 — BNY Mellon, the global leader in investment management and investment services, has seen a six-fold increase in the number of unsponsored DR programs, following an SEC rule change in October 2008*.  The rule revision, simplifying the formation and trading of over-the-counter DRs of non-U.S. publicly-traded companies, has resulted in more than 1,000 new unsponsored DRs from 35 countries coming to market.  These DRs have a combined market capital estimated at $12 billion. 

BNY Mellon has set up programs for 92% of the unsponsored DRs created since late 2008, including more than 400 where it is the only depositary on record.  The new DRs are in response to investor demand for access to companies in key sectors and countries, such as mining operations in China, manufacturers in Japan, and forestry firms in Finland.  Rising interest in non-U.S. equities has driven up the number of all DR programs, sponsored and unsponsored, to more than 3,400 – a 6.2% jump over the past year.

"With investors seeking greater diversification, we're not surprised by the growth in interest and creation of unsponsored DRs that have helped global companies raise visibility in the U.S. marketplace," said Michael Cole-Fontayn, CEO of BNY Mellon's Depositary Receipts business.  "Also, more than 240 unsponsored DRs are now being used in the BNY Mellon family of DR indices.  

"Investment firms are launching a range of new ETFs tied to these indices to address the surging demand for lower cost, more transparent investment vehicles," Cole-Fontayn added.

Through efforts to expand the unsponsored DR universe, investors can now use DRs to trade:

  • 100% of Hong Kong's Hang Seng Index
  • 39 of 40 constituents in France's CAC (98%)
  • 29 of 30 component equities in Germany's DAX (97%)
  • Nearly 90% of both the Tokyo 100 and FTSE 100 indices.

Unsponsored DRs also have improved investor ability to access global industry sectors.  For example, using DRs alone, U.S. investors can now hold:

  • 80% of MSCI All World ex-U.S. Consumer Staples index constituents
  • 76% of MSCI All World ex-U.S. Consumer Discretionary index
  • 74% of MSCI All World ex-U.S. Materials Sector
  • 67% of MSCI All World ex-U.S. Energy Sector index. 

"Being able to better replicate major indices and quickly respond to investor requests for new unsponsored programs has heightened the popularity and viability of all DR programs," said Michael Finck, head of global service delivery for BNY Mellon's DR group.

An unsponsored DR is issued by one or more depositary bank in response to investor demand and requires no involvement from the non-U.S. company whose stock the DR represents, whereas sponsored DRs are issued by a single depositary bank appointed by an issuer.  Unsponsored DRs trade over-the-counter, while sponsored DRs can trade OTC or on a major stock exchange.

BNY Mellon acts as depositary for more than 2,500 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

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 $25.9 trillion in assets under custody and administration and $1.2 trillion in assets under management, services $11.7 trillion in outstanding debt and processes global payments averaging $1.6 trillion per day.  BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK).  Learn more at 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.


* As a result of the change on October 10, 2008 to Rule 12g3-2(b) under the Securities Exchange Act of 1934, certain non-U.S. companies became automatically exempt from SEC reporting requirements, if, among other things, key information could be found in English on their websites.  Submitting hard-copy exemption requests to the SEC is no longer required.