Vanguard, the third-largest U.S. issuer of exchange traded funds, said Wednesday it is lowering the annual fees on 12 of its ETFs, including its 10 sector funds.

By reducing fees on sector funds such as the Vanguard Consumer Discretionary ETF (NYSEArca: VCR) and the Vanguard Consumer Staples ETF (NYSEArca: VDC) to 0.12% per year from 0.16%, Vanguard’s sector ETFs move into a tie with their Fidelity rivals for least expensive sector ETFs.

Fidelity, which rolled out its 10-ETF suite of sector ETFs in October, introduced those funds with 0.12% annual expense ratios. Those 10 funds have since amassed a combined $2 billion in assets under management. [More Competition for Sector ETFs]

“Vanguard has long been a low-cost leader, which can be attributed to our unique corporate ownership structure and our relentless pursuit to operate more efficiently and productively. Vanguard is owned by our funds—and, in turn, the funds are owned by their shareholders. And Vanguard must operate ‘at cost’—it can charge the funds only enough to cover its costs of operation. This structure lets us provide our services to the Vanguard funds at cost. It’s a structure that allows us to pass along economies of scale—and reduce expenses—as fund assets grow,” said Pennsylvania-based Vanguard in a statement.

The company also reduced the fees on the Vanguard Financials ETF (NYSEArca: VFH) to 0.12%. VFH previously charged 0.19% per year, making it more expensive than the Financial Select Sector SPDR (NYSEArca: XLF) and the Fidelity MSCI Financials Index ETF (NYSEArca: FNCL).

“In addition, Vanguard runs a tight ship. We spend modest amounts on marketing relative to competitors, do not pay third parties to distribute our funds, and negotiate favorable fee arrangements with our external investment advisors and benchmark providers, all of which result in significant cost savings for our clients over the long term,” said Vanguard in the statement.