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Citi, Goldman Plan ETFs Tied to Riskiest Bank Bonds

  • New products will track additional Tier 1 bank bond market
  • Broader access may lead to volatility: Cairn Capital

Citigroup Inc. and Goldman Sachs Group Inc. are among firms seeking to set up exchange-traded funds tracking the riskiest European bank bonds, according to people familiar with the matter.

Citi met with investors this year to promote an ETF that will track an index of additional Tier 1 notes, said the people, who asked not to be identified because the information isn’t public. Goldman is working with an issuer to offer a similar product, while China Post Global, the international asset-management unit of China Post & Capital Fund Management Co., is also preparing an AT1 fund, the people said.