Nuveen Investments will become the sub-adviser to five municipal bond SPDR exchange-traded funds and other municipal bond strategies managed by State Street Global Advisors, an alliance that will likely lead to future joint product launches between the two.

Timothy Ryan, head of State Street Global Advisors' municipal bond group who now manages the ETFs, will move to Nuveen Investments as senior vice president to serve as lead portfolio manager for the SPDR ETFs, which now have assets of nearly $2 billion. State Street Global Advisors is the investment management business of State Street Corp. (STT).

The five funds, which will be rebranded as SPDR Nuveen municipal ETFs, are: SPDR Barclays Capital Municipal Bond ETF (TFI); SPDR Barclays Capital California Municipal Bond ETF (CXA); SPDR Barclays Capital New York Municipal Bond ETF (INY); SPDR Barclays Capital Short Term Municipal Bond ETF (SHM); and SPDR S&P VRDO Municipal Bond ETF (VRD).

The sub-advisory agreement has been approved by the board of trustees and shareholders for each ETF, and is effective April 1.

Combining Nuveen's experience in managing municipal bond portfolios with State Street's expertise in ETFs creates an unmatched offering in muni bond portfolios, said Jim Ross, senior managing director at State Street. It puts the two companies in a strong position "to develop and launch joint products" in the future, he said.

"From an investor's point of view, we think the tie-up will be quite powerful," he said.

Bill Huffman, chief operating officer and co-head of Nuveen Asset Management, said Nuveen looks forward to developing passively managed ETF products with State Street Global Advisors in the future. Actively managed products are "always a possibility," Huffman said.

As of Dec. 31, Nuveen managed nearly $70 billion in municipal bond securities.

State Street Global Advisors is one of the largest ETF providers globally, with SPDR ETF assets of more than $204 billion under management as of Dec. 31.

-By Daisy Maxey; Dow Jones Newswires; 212 416 2237; daisy.maxey@dowjones.com