Vanguard Group saw the highest inflows among exchange traded fund providers in 2011 and the firm’s chief investment officer says the company remains upbeat on the growth prospects of the ETF business.

“ETFs are 15% of the assets in the mutual fund industry,” Vanguard CIO Gus Sauter told CNBC’s Bob Pisani in an interview this week. “They are huge and growing at the fastest rate in the industry. ETFs are here to stay [and]a big part of the future.”

Vanguard led ETF inflows in 2011 for the second year in a row, hauling in nearly $36 billion. [U.S. ETFs See More Inflows]

“ETFs we look at as just a way to distribute our index funds,” Sauter said. Vanguard is best known for its passively managed index funds but has adopted ETFs as an alternative wrapper.

The world’s largest actively managed mutual fund, Pimco Total Return Fund, is also readying an ETF offshoot. [Active ETFs Seen Taking Off in 2012]

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