Bankia Asset Management has announced the closure of its pound-denominated fixed income fund due to low demand from investors amid Brexit's slow evolution.
Bankia Libra was launched after the Brexit referendum, in April 2017, at a time when the pound had already dropped by 15%. The Fund invests in fixed income, both public and private, issued denominated in pounds and belonging to any issuer in the world.
According to Bankia, the strategy was launched in response to the firm's private banking clients, who were betting on the rise of the pound against the euro in the medium to long term. "But the Brexit negotiations have been taking longer than expected and the pound's evolution has been relatively flat since then. Given this context and the fund's current assets under management, we have decided that it makes no sense to maintain such a niche fund," adds the entity.
Bankia Libra, which closes with less than 140 participants and below €600bn in assets under management, is being integrated into another fund of the firm, the Bankia Diversification Fund, which is "a conservative fund without commission fees offering investors the possibility to withdraw their money at any time," explains a spokeperson from the Bank.
Bankia has also recalled that in the firm's catalog there are other funds to invest in fixed income in currencies but offering investors greater diversification. The Bankia Dolar and the Bankia International Bonds are two of these investment products.