The folks at a $241-billion-AUMS (as of August 31), Chicago area asset manager are planning to transform a 17-year-old income fund next year.

Ryan O. Issakainen First Trust Portfolios L.P. Senior Vice President, ETF Strategist

Yesterday, the team at First Trust Advisors L.P. (FTA) [profile] revealed that the board of trustees of the First Trust Specialty Finance and Financial Opportunities Fund (FGB on the NYSE) have approved a plan to reorganize the closed-end fund by transforming it into a brand new exchange-traded fund, the FT Confluence BDC & Specialty Finance Income ETF. FGB's investment advisor, FTA, and FGB's subadvisor, Confluence Investment Management LLC, would stay on with the new ETF in the same roles.

The First Trust team expects the reorganization to take place in 2025. FGB's board scheduled their 2024 annual shareholder meeting for November 12, and a separate special meeting will also be set up for the shareholders to consider the transformation plan.

FGB's inception date was May 25, 2007, and as of yesterday (Tuesday, September 10, 2024), the fund had $68.7 million in total managed assets. Its expense ratio for its managed assets is 237 basis points. Computershare Trust Company, N.A. serves as investor servicing agent.

The First Trust team has not yet issued a prospectus for the planned ETF. They also haven't revealed the ETF's planned ticker.

Yet a First Trust filing, submitted yesterday with the SEC, suggests that the planned ETF would be a series of First Trust Exchange-Traded Fund VIII. If so, the ETF's other providers would include: the Bank of New York Mellon as administrator, custodian, fund accountant, and transfer agent; Chapman and Cutler LLP as counsel; Deloitte & Touche LLP as independent accounting firm; and First Trust Portfolios L.P. (FTP) as distributor. 

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