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Magazine Issues » December-January 2012

OUTSOURSING: Selected deals in 2011

Citi and Man Group: Man Group appointed Citi as its 'global shareholder services partner' in March 2011. Citi will provide global transfer agency services and administration, which will include valuations for a number of Man Group funds. As part of the arrangement, 45 Man Group employees were transferred to Citi along with  Man Group's in-house system, although the plan is to migrate onto Citi's platform at some point in 2012.

Citi and Skandia: Dublin-based Skandia Investment Group, an existing client, appointed Citi as the sole provider of investor services for its two fund ranges in November 2011. The mandate includes custody, trustee and transfer agency services as well as the management of fund factsheets and Key Investor Information Document disclosure. According to Citi's Richard Ernesti, Skandia was looking for better economies by using a single provider for its investor servicing.

Citi and EIB: The European Investment Bank (EIB) awarded a mandate to Citi for the collateral management and global custody of its derivatives operations in June 2011. EIB had previously used two providers, RBS for collateral management and BNY Mellon for custody. Citi will be responsible for mark to market duties, margin calls, settlement and global custody while EIB will continue to value its own derivatives.

BNY Mellon and Bridgewater Associates: In November 2011, the US investment manager Bridgewater employed BNY Mellon to supply back and middle office outsourcing for around $125 billion (€93 billion) of assets. Bridgewater, an existing client of BNY Mellon's back-office outsourcing service, will be migrating to BNY Mellon's OnCore platform and some 100 employees will be transferred from Bridgewater to BNY Mellon. The services provided include derivatives processing and performance attribution.

BNY Mellon and BBVA Asset Management: Also announced in November 2011 was BNY Mellon's mandate to provide middle-office services to BBVA Asset Management's €23 billion global funds range. Services include over-the-counter derivatives trade affirmation and confirmation, independent valuation, portfolio reconciliation and collateral management and custody and will be delivered via BNY Mellon's Derivatives360 platform.

State Street and Pimco: In November 2011, Pimco renewed its mandate with State Street, one of the largest in the market covering $1.3 trillion in assets. The original deal was signed in 2000 when State Street assumed Pimco's investment operations including trade processing, custody, accounting, collateral management, pricing and derivatives processing and IT development. The renewed deal will see State Street move all of Pimco's outsourced services onto State Street's single operating platform.

State Street and Martin Currie: State Street struck a similar deal with UK-based manager Martin Currie Investment Management in April 2011, renewing a long-standing mandate to provide outsourced services for £11 billion of assets-under-management and extending from the provision of back-office services to include middle-office services.

State Street and Alliance Bernstein: Also in November 2011, US-based Alliance Bernstein contracted State Street to provide back and middle-office services on a global basis for $300 billion in client assets. A similar but much smaller scale deal was completed in 2009 covering Alliance Bernstein's Japanese institutional clients. As part of the deal, 100 Alliance Bernstein employees will move to State Street to provide transitional support.

* An outsourcing review published in the August edition of Funds Europe covered other deals completed this year including JP Morgan WSS and Artemis, State Street and F&C Investments and Societe Generale Securities Services and Credit Suisse Asset Management.

©2011 funds europe