Mn Adds Client Value with Robust Investment Management Software Solution

CLIENT STORY MN ADDS CLIENT VALUE WITH ROBUST INVESTMENT MANAGEMENT SOFTWARE SOLUTION

How MN boosted its private equity and real estate business with SimCorp’s integrated Alternative Investments solution. Client Story | MN 2

MN UPGRADES ITS ALTERNATIVE INVESTMENTS OFFERING

An integrated SimCorp solution helped MN deliver more transparency, flexibility, and value to its alternative investments offering. As a result, MN can service client demands more competitively and efficiently.

IN SEARCH OF A RELIABLE ASSET DETAILED REPORTING AND AUTOMATIC ADMINISTRATION SYSTEM VALUATION AS KEY DRIVERS Dutch pension administrator and asset manager MN The proof-of-concept consisted of the full administra- wanted to administer its private equity (PE) and real tion of six MN funds, three of which were private equi- estate (IOG) investments with a more dedicated, ty and three real estate funds, including basic report- reliable and service-oriented system, in the process ing. End-users of the PE and IOG business segments of moving away from a heavy internal reliance on approved the proof-of-concept in June 2011, which Microsoft Excel. Explains Timo Zomerdijk, Head of marked the actual start of the project. Valuation, Reporting & General Ledger, MN: “As Excel was not a preferred system for administration, we The requirements for the new administration were started to search for a complete and solid system to analysed and based on the MS Excel administration administer both investment segments so that data of the IOG segment. Adds Timo Zomerdijk: “Besides could be derived from the system in a structured and the transaction administration, detailed reporting and orderly way.” automatic valuation based on transactions were the main drivers.” MN’s main requirements were that the solution could create reports, make calculations and store all static SimCorp demonstrated the solution and MN saw that data at both fund level and underlying level (building all the requirements could be fulfilled. In the project and company level). Timo Zomerdijk: “For us, it was phase, extra requirements emerged and SimCorp not a question of reducing costs; it’s an investment in had an answer for each and every need as it arose. quality, more and better data, up-to-date data, acces- Either the solution was known in advance or else was sible data and also for the fund manager to run his referred to SimCorp to get it fixed, which proved an portfolio more efficiently.” invaluable experience for MN.

A SimCorp client since 2002, MN looked to its current The project’s configuration phase ran from July to investment management software business partner for end-November 2011, followed by testing in December a solution. Following a presentation in May 2011, SimCorp and January 2012. Three weeks into 2012, the new was asked to initiate a proof-of-concept. This was based functionality went into production by converting the on SimCorp Dimension’s Alternative Investments solu- funds from the original Fund Certificate administration tion, enhanced with the latest features and designed to in SimCorp Dimension to the detailed Alternative handle private equity and real estate investments. Investments functionality.

MN had worked with SimCorp on several occasions before, and felt comfortable and secure in drawing on the accumulated skills, know-how and experience that SimCorp’s specialist consultants had to offer in the area of project collaboration. Client Story | MN 3

Timo Zomerdijk, Head of Valuation, Reporting & General Ledger, MN: “The SimCorp solution met all our system service requirements. As it can also communicate with our main asset management administration system (SimCorp Dimension), the choice was easily made.”

REGISTERING TRANSACTIONS MORE EFFECTIVELY for the Fund Decomposition functionality added in AND FLEXIBLY one of the releases SimCorp Dimension provides cli- The new method of administering its alternative ents twice a year to continually upgrade and enhance investment transactions with dedicated transaction its product and service portfolio. codes and screens enables MN to register each transaction in more detail, and with a payment attached directly to each transaction. These payments are then CREATING DETAILED REPORTS BASED approved and ultimately reconciled with the imme- ON ONE DATABASE diate business transaction attached to it. At a later Having all transaction information and fund data in stage, payments will be automated and netted by use SimCorp Dimension allows MN to create a number of SWIFT instructions. of more service-oriented reports, all based on one database. Reports can now be generated directly Also, a number of fee types like management fees from SimCorp Dimension, as opposed to constructing that could only be registered as part of a capital call reports based on several spreadsheets. These reports earlier can now be registered separately; the flexible contain a number of key ratios like Internal Rate of definition of these expense (and income) types en- Return, Total Value to Paid-In, etc. sures that every type of fee can be registered separately in SimCorp Dimension. Having a solid and up-to-date overview of all the private equity and real estate portfolios without com- paring and merging Excel sheets is one of the gains GENERATING ADDED VALUE FOR CLIENTS achieved by MN. As Timo Zomerdijk states: “Running The new administration allows for more detailed in- just one system enables all the information to become formation to be registered. Not only do the funds that accessible to all the relevant departments: the settle- MN invests in on behalf of its clients contain useful ment and valuation departments, financial reporting, information; the investments in buildings and compa- not to mention the fund manager.” nies by those funds provides detailed information that can be used for an analysis of the investments per country, region or sector, across all funds. AUTOMATING THE VALUATION PROCESS Another key business driver for MN was valuation. This information is very valuable for MN and its clients. Private equity and real estate fund managers tend to Timo Zomerdijk: “This information enables us and update their investors each quarter with regard to the them to see our and their exposure on a more detailed value of investments in funds. This invariably means level and then to act on it.” Setting up the funds and the value of the funds is not known in between the their underlying investments in this way prepared MN quarters. Client Story | MN 4

“The bottom line is that we now have an easy-to-use and accessible system that can produce at any time of the day an overview of all our private equity and real estate investments, with the latest valuations, investment regions, businesses, investment managers, called/- outstanding commitments, and more. TIMO ZOMERDIJK Head of Valuation, Reporting & General Ledger, MN

By using the Alternative Investments solution, MN can For MN, choosing the Alternative Investment solution take into account for valuation all the relevant trans- to complement its in-house use of SimCorp Dimension actions conducted during each quarter (i.e. capital as the main asset administration system has proved to calls, capital returns, fees, dividends, etc.) to generate be a highly flexible solution, well suited for cash flow- up-to-date figures between end-of-quarter dates. This based investments, such as direct investments, private process has been automated in SimCorp Dimension, equity fund investments, and real estate investments. adding flexibility and ensuring that every transaction As Timo Zomerdijk sums it up: “The bottom line is that triggers an update of the market values where even we now have an easy-to-use and accessible system back-dated changes are taken into account. that can produce at any time of the day an overview of all our private equity and real estate investments, with the latest valuations, investment regions, businesses, in- QUICK AND EASY ACCESS TO ALL DATA vestment managers, called/outstanding commitments, To allow its fund managers and middle office quick and more.” and easy access to all data, MN also opted to install SimCorp’s Portfolio Workbench solution, which provides for:

• Up-to-date market values per fund or even per underlying company • Fund types and fund strategies • Geographical and sector distributions • Key ratios

Access to these up-to-date figures, combined with graphical tools and pivot tables, provides additional value to MN’s fund managers when they assess the investments and improves communication with clients when it comes to evaluating their investments.

A HIGHLY FLEXIBLE AND ACCESSIBLE SOLUTION Implementing a new solution required a thorough Name: MN look-through methodology. As is typical in project Headquarters: The Hague, The Netherlands work like this, MN had a lot of questions and, as its Industry: Pension administrator and asset manager business partner, SimCorp was there to assist in find- Business: Pension administration and investment ing all the right answers. With the constant on-site management help and advice of SimCorp consultants, MN found AUM: Over ¤90 billion the solutions it sought in speedy and effective project Website: www.mn-services.com implementation. Client Story | UNIQA 5

CLIENT STORY QUICK FACTS

CHALLENGES SOLUTION • Replace old system to administer private equity • A single fully integrated solution meeting all criteria (PE) and real estate (IOG) investments in a more – both present and future dedicated, reliable and efficient way • Convincing proof-of-concept with solution • Move away from heavy reliance on Microsoft Excel designed for specific needs spreadsheets • Flexible portfolio workbench tool for front- and • Find a sophisticated and service-oriented device to middle-office users support alternative investments • On-line tool with key ratios and positions for full • Satisfy reporting needs of external clients and access to all data internal stakeholders (i.e. fund managers and senior management) FEATURES AND BENEFITS • Commitment transactions: holding without any OBJECTIVES cash flow • Adopt more detailed administration with sectoral • New balances for commitment, unpaid commit- and regional distribution of all funds (decomposition) ment and called capital • Implement improved reporting and automatic • Dedicated transaction windows and transaction valuation mechanisms codes – income and expenses freely definable • Set up cash flow registration (transparency of fees) • Market values instead of nominals • Design future-proof solution (reporting in-house) • Cash directly linked to the investment – no single • Benefit from prior experience with SimCorp service payment transactions anymore implementation practices • Registered in one database, available for in-house reporting (future-proof) • Prepared for automatic payment instructions (and netted)

ABOUT MN MN is one of the largest pension administrators and asset comprehensible and affordable pension scheme. MN managers in the Netherlands. Pension administration and manages assets worth over ¤90 billion for a wide range investment management comprise MN’s core activities. of pension funds in the Netherlands and in the United With over 60 years of experience in these areas, MN assists Kingdom. Apart from corporate headquarters in The Hague, its clients with extensive knowledge of the Dutch pension Netherlands, MN has offices in Amsterdam and London. system. Some 1,000 dedicated employees ensure that nearly two million Dutch nationals are supplied with a More information at www.mn-services.com. ABOUT SIMCORP SimCorp provides integrated, best-in-class investment management solutions to the world’s leading asset managers, fund managers, asset servicers, pension and insurance funds, wealth managers and sovereign wealth funds. Whether deployed on premise or as an ASP solution, its core system, SimCorp Dimension, supports the entire investment value chain and range of instruments, all based on a market- leading IBOR. SimCorp invests more than 20% of its annual revenue in R&D, helping clients develop their business and stay ahead of ever-changing industry demands. Listed on NASDAQ Copenhagen, SimCorp is a global company, regionally covering all of Europe, North America, and Asia Pacific.

For more information, please visit www.simcorp.com.

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