EuroMTS says Banca IMI S.p.A. has become the first licensee of its EuroMTS Inflation Linked Index (EMTXi) and that Erste Bank is the first Austrian licensee for the EuroMTS 5-7 Index (EMTX 5-7).
Banca IMI S.p.A. has licensed the EMTXi index for use as the underlying reference in its Certificates Reflex listed on the Italian Stock Exchange, Borsa Italia S.p.A. Meanwhile, Erste Bank has licensed the EMTX 5-7 year band index for use as the underlying reference in a new 12-year maturity “Rainbow” structured product listed on the Vienna Stock Exchange.
“We are pleased to launch the first product utilizing the EMTXi, the first real-time index of inflation-linked government bonds of the eurozone, which allows our customers to access in an easy way the expanding market of these securities,” says Paolo Giulianini, Head of Equity Benchmarks.
Wolfgang Eder, Legal Risk Manager for Global Financial Markets, Erste Bank, described the EuroMTS indices as the most representative for several markets. “The use of the EuroMTS index offers an efficient and transparent way to link the product to the eurozone government bond market,” he says.
Scott Stark, CEO of MTSNext, says that since the launch of the EMTXi index in June, it has been adopted by fund managers for use as a benchmark, but that IMI and Erste are the first to use it as the basis of financial products for the retail market. “In addition, the launch of this first structured product using a EuroMTS index in Austria provides further evidence of the wide recognition of the characteristics of representation, transparency and tradability of these indices across Europe,” he says.
The EuroMTS Index, formerly the CNO Etrix, was acquired by EuroMTS in January 2003 and has since been extended to include real-time pricing with two daily fixings. It is composed of a global index (Eurozone sovereigns) and six maturity-band sub-indices. The EuroMTS indices family also includes the EuroMTS Inflation-Linked Bonds Index (EMTXi) and the EuroMTS New EU Index (EMTXn) of euro-denominated bonds issued by the new members of the European Union. The EMTXi incorporates eurozone issues quoted on MTS – the reference market in Europe for fixed income securities – with more than EUR2 billion in outstanding size and at least one year to maturity. The index, comprised of the entire range of inflation-linked securities listed on the EuroMTS Linkers Market, currently includes one Greek, three Italian and eight French inflation-linked bonds. The EMTXi was designed to accurately represent the eurozone inflation-linked bond market and to be homogenous with the existing EuroMTS Index family.
The EuroMTS Indices are used as benchmarks by over 200 institutions with an estimated EUR200 billion in assets referenced to the indices. Several structured products have been issued in France and Italy using the EuroMTS Indices and three ETFs are currently listed on the Euronext and Borsa Italia exchanges, with over EUR590 million in assets under management.