TORONTO, April 13,
2023 /CNW/ - RBC Global Asset Management Inc.
("RBC GAM Inc.") today announced changes to several RBC ETFs in its
suite of RBC Target Maturity Corporate Bond Index ETFs ("RBC
TMCBs"), including management fee reductions and changes to their
maturity dates. In addition, RBC GAM Inc. also announced a change
to the unitholder right to redeem for cash for all RBC ETFs and ETF
Series of RBC Funds.
Management fee reductions – RBC TMCBs
Effective
immediately, the management fee for each RBC TMCB will be reduced
from 0.25% to 0.20%, with the exception of RBC Target 2023
Corporate Bond Index ETF (TSX: RQK), which had its management fee
reduced to 0.20% on January 1, 2023,
as stated in its prospectus.
Change in maturity dates of several RBC TMCBs and maturity
date of RBC Target 2023 Corporate Bond Index ETF
In response
to advisor feedback, the maturity dates of several RBC TMCBs are
being advanced to "on or about September
30" from "on or about November
30." This change gives advisors more time to re-invest the
maturity proceeds of the RBC TMCBs in advance of year end.
In connection with the above, RBC Target 2023 Corporate Bond
Index ETF will mature on or about September
15, 2023.
The chart below summarizes the changes being made to the suite
of RBC TMCBs:
Ticker
|
ETF
Name
|
Maturity Date
as currently
stated in the
prospectus
|
New Maturity
Date
|
Management
Fee as
currently
stated in the
prospectus*
|
New
Management
Fee effective
April 13,
2023
|
RQK
|
RBC Target 2023
Corporate Bond
Index ETF
|
on or about
November 30,
2023
|
on or about
September 15,
2023
|
0.20 %
|
0.20 %
|
RQL
|
RBC Target 2024
Corporate Bond
Index ETF
|
on or about
November 30,
2024
|
on or about
September 30,
2024
|
0.25 %
|
0.20 %
|
RQN
|
RBC Target 2025
Corporate Bond
Index ETF
|
on or about
November 30,
2025
|
on or about
September 30,
2025
|
0.25 %
|
0.20 %
|
RQO
|
RBC Target 2026
Corporate Bond
Index ETF
|
on or about
November 30,
2026
|
on or about
September 30,
2026
|
0.25 %
|
0.20 %
|
RQP
|
RBC Target 2027
Corporate Bond
Index ETF
|
on or about
November 30,
2027
|
on or about
September 30,
2027
|
0.25 %
|
0.20 %
|
RQQ
|
RBC Target 2028
Corporate Bond
Index ETF
|
on or about
September 30,
2028
|
No
change**
|
0.25 %
|
0.20 %
|
RQR
|
RBC Target 2029
Corporate Bond
Index ETF
|
on or about
September 30,
2029
|
No
change**
|
0.25 %
|
0.20 %
|
*
|
Currently, the
management fee for each RBC TMCB is reduced in the maturity year
from 0.25% to 0.20%. Following the management fee change there will
no longer be a management fee reduction in the maturity
year.
|
**
|
The maturity date for
RQQ and RQR was set as "on or about September 30, 2028" and "on or
about September 30, 2029" respectively, when each ETF was initially
formed. Therefore, there is no change in maturity date
occurring.
|
Unlike traditional exchange-traded funds ("ETFs") which have a
perpetual life, target maturity ETFs have a specified maturity
date. When the ETF reaches its maturity date, the ETF's final net
asset value ("NAV") is returned to the current unitholders.
A target maturity ETF's portfolio contains securities that
mature throughout its stated maturity year. This structure results
in a duration profile similar to that of an individual bond, where
the ETF's duration can be expected to decline as it approaches
maturity, reducing sensitivity to interest rate changes. These ETFs
do not seek to return any predetermined amount at maturity.
Further details of the RBC Target 2023 Corporate Bond Index ETF
maturity will be mailed to unitholders at least 60 days prior to
the maturity date. RBC GAM Inc. will issue an additional press
release on or about the maturity date of RBC Target 2023 Corporate
Bond Index ETF confirming final details of the maturity.
Change to right to redeem for cash for all RBC ETFs and ETF
Series of RBC Funds
The unitholder right to redeem for cash
(currently for a redemption price equal to 95% of net asset value
of the units of the applicable RBC ETF or ETF Series of RBC Funds
on the effective day of the redemption) is being changed to align
with current market practice.
Effective on or about April 21,
2023, unitholders may redeem units of an RBC ETF or ETF
Series of RBC Funds for cash at a redemption price per unit equal
to the lesser of:
a) 95% of the closing price for the units
of the applicable RBC ETF or ETF Series of RBC Funds on the TSX or
Neo Exchange, as applicable, on the effective day of the
redemption, and
b) The net asset value per unit of the
applicable RBC ETF or ETF Series of RBC Funds on the effective day
of the redemption.
Unitholders will generally be able to sell (rather than redeem)
units at the full market price on the TSX or Neo Exchange, as
applicable, through a registered broker or dealer subject only to
customary brokerage commissions.
For further information regarding RBC ETFs, please visit
www.rbcgam.com/etfsolutions.
Commissions, management fees and expenses all may be associated
with investments in mutual funds and exchange-traded funds (ETFs).
Please read the ETF Facts or prospectus of the relevant RBC ETF or
ETF Series unit of the RBC Fund before investing. Mutual funds and
ETFs are not guaranteed, their values change frequently and past
performance may not be repeated. ETF units and ETF Series units of
RBC Funds are bought and sold at market price on a stock exchange
and brokerage commissions will reduce returns. Index returns do not
represent RBC ETF returns. RBC ETFs are managed by RBC Global Asset
Management Inc., which is a member of the RBC GAM group of
companies and an indirect wholly owned subsidiary of Royal Bank of
Canada. RBC Funds are offered by
RBC Global Asset Management Inc. and distributed through authorized
dealers in Canada.
RBC Target 2023 Corporate Bond Index ETF, RBC Target 2024
Corporate Bond Index ETF, RBC Target 2025 Corporate Bond Index ETF,
RBC Target 2026 Corporate Bond Index ETF, RBC Target 2027 Corporate
Bond Index ETF, RBC Target 2028 Corporate Bond Index ETF and RBC
Target 2029 Corporate Bond Index ETF (collectively, the "TMCB
ETFs") do not seek to deliver a predetermined amount at maturity,
and the amount an investor receives may be more or less than their
original investment. The TMCB ETFs have been developed solely by
RBC GAM Inc., and are not in any way connected to or sponsored,
endorsed, sold or promoted by the London Stock Exchange Group plc
and its group undertakings (collectively, the "LSE Group").
All rights in the FTSE Canada 2023 Maturity Corporate Bond
Index, FTSE Canada 2024 Maturity Corporate Bond Index, FTSE Canada
2025 Maturity Corporate Bond Index, FTSE Canada 2026 Maturity
Corporate Bond Index, FTSE Canada 2027 Maturity Corporate Bond
Index, FTSE Canada 2028 Maturity Corporate Bond Index and FTSE
Canada 2029 Maturity Corporate Bond Index (collectively, the "FTSE
Maturity Corporate Bond Indices") vest in the relevant LSE Group
company which owns the FTSE Maturity Corporate Bond Indices.
"FTSE®" is a trade mark of the relevant LSE Group company and is
used by any other LSE Group company under license.
The FTSE Maturity Corporate Bond Indices are calculated by or on
behalf of FTSE Global Debt Capital Markets Inc. or its affiliate,
agent or partner. The LSE Group does not accept any liability
whatsoever to any person arising out of (a) the use of, reliance on
or any error in the FTSE Maturity Corporate Bond Indices or (b)
investment in or operation of the TMCB ETFs. The LSE Group makes no
claim, prediction, warranty or representation either as to the
results to be obtained from the TMCB ETFs or the suitability of the
FTSE Maturity Corporate Bond Indices for the purpose to which they
are being put by RBC GAM Inc.
About RBC
Royal Bank of Canada is a global financial institution with
a purpose-driven, principles-led approach to delivering leading
performance. Our success comes from the 97,000+ employees who
leverage their imaginations and insights to bring our vision,
values and strategy to life so we can help our clients thrive and
communities prosper. As Canada's
biggest bank, and one of the largest in the world based on market
capitalization, we have a diversified business model with a focus
on innovation and providing exceptional experiences to our 17
million clients in Canada, the
U.S. and 27 other countries. Learn more at rbc.com.
We are proud to support a broad range of community initiatives
through donations, community investments and employee volunteer
activities. See how at rbc.com/community-social-impact.
About RBC Global Asset Management
RBC Global Asset
Management (RBC GAM) is the asset management division of Royal
Bank of Canada (RBC) and includes
money managers BlueBay Asset Management and Phillips, Hager &
North Investment Management. RBC GAM is a provider of global
investment management services and solutions to institutional,
high-net-worth and individual investors through separate accounts,
pooled funds, mutual funds, hedge funds, exchange-traded funds and
specialty investment strategies. The RBC GAM group of companies
manage approximately $525 billion in
assets and have approximately 1,500 employees located across
Canada, the United States, Europe and Asia.
SOURCE RBC Global Asset Management Inc.