LITs grow in popularity

Equity Trustees, which is the responsible entity (RE) of the NB Global Corporate Income Trust’s A$413 million listed investment trust (LIT), has said that the listing on the Australian Securities Exchange (ASX) of Neuberger Berman’s NB Global Corporate Income Trust is another sign of the growing popularity of listed investment trust (LIT) structures.

Investors might be particularly attracted to this LIT structure as it aimed to provide a regular income stream and maintain a strong emphasis on capital preservation.

The firms said that these structures would be additionally growing in popularity due to an ageing popularity which would be moving into retirement phase.

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Equity Trustees’ executive general manager, corporate trustee services, Harvey Kalman, stressed that distributions, paid in monthly instalments, was one of the benefits of this LIT structure.

“The reason we don’t see more of these kind of structures in the market is that they require a big commitment up front by a number of parties to establish. But given the keen investor and broker interest in this trust and the IPO ... we’re confident there will be more to come,” he said.

“Having established the trust, the task now is to take care of all the operational governance and compliance obligations while the investment manager, Neuberger Berman, focus on the investment strategy.”

Neuberger Berman is a private, independent, employee-owned asset management group which manages more than US$300 billion in client assets (as at 30 June 2018) across a range of strategies—including equity, fixed income, quantitative and multi-asset class, private equity and hedge funds—on behalf of institutions, advisers and individual investors globally.

It has been in Australia since 2007 and has 20 offices globally.

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