BNP Paribas Launches U.S. TIPS Fund

To meet rising demand for Treasury inflation-protected securities (TIPS), BNP Paribas launched a fund that is being managed by FFTW.

BNP Paribas Investment Partner Trust Company introduced the FFTW U.S. TIPS Fund, a collective investment trust vehicle managed by Fischer Francis Trees & Watts Inc. (FFTW), which will be offered to qualified U.S. defined benefit and defined contribution plans.

The fund is being launched with almost $44 million and is BNPP’s second collective investment trust fund following its stable value fund (called the Income Plus Fund).

BNPP’s U.S. TIPS strategy relies primarily on inflation-linked bonds and nominal sovereign bonds in seeking to generate incremental returns over the Barclays Capital U.S. TIPS Index, said James Johnston, head of U.S. sales for BNPP.

FFTW manages large U.S. TIPS separate accounts for public plans, endowments and foundations, and central banks. It is a manager of inflation-protected securities and had approximately $11.3 billion in assets under management (AUM) in this area as of June 30, 2012; its U.S. TIPS strategy had approximately $4.5 billion AUM.

BNP Paribas Investment Partner Trust Company is the asset management arm of BNP Paribas Group. FFTW is a BNPP affiliate.