May/Jun 2010 Volume 7 No. 47 Investor Services Annual membership Journal GBP 249 - UK, ROW USD 379 - America ISJ EUR 286 - EMEA www.ISJ.tv
THE GLOBAL CUSTODY AND ASSET SERVICING INDUSTRY MAGAZINE
Under the microscope, UCITS - the workings
European Custody - 2011 Guide Mark Mobius - ISJ Profile Corporate Actions - XBRL, Swift and DTCC www.ISJ.tv Barclays Exits - African custody
Front Cover Section ISJ47.indd 1 03/06/2010 20:37 Bottom line: Your securities services expert 2in Central and Eastern Europe @ Our network is available for you in Central and Eastern Europe for your securities services business. We bring you in-depth local experience and award winning international expertise. ING is your partner in Bulgaria, Czech Republic, Hungary, Poland, Romania, Russia, Slovak Republic and Ukraine. For more information call Lilla Juranyi, Global Head of Custody, on +31 20 7979435 or e-mail: [email protected].
www.ingcommercialbanking.com
ING Commercial Banking is a marketing name of ING Bank N.V., registered by the Netherlands Authority for the Financial Markets (AFM). Copyright ING Commercial Banking (2010).
FrontISJ47 Covercomplete Section text.indd ISJ47.indd 15 2 03/06/201027/05/2010 20:3812:11 contents Heads Up
May/Jun 2010 Volume 7 No. 47 Investor Services Annual membership Journal GBP 249 - UK, ROW USD 379 - America ISJ EUR 286 - EMEA www.ISJ.tv
THE GLOBAL CUSTODY AND ASSET SERVICING INDUSTRY MAGAZINE
Under the microscope, UCITS - the workings Investor Services ISJ Journal
European Custody - 2011 Guide Mark Mobius - ISJ Profile Corporate Actions - XBRL, Swift and DTCC www.ISJ.tv Barclays Exits - African custody THE GLOBAL CUSTODY AND ASSET SERVICING INDUSTRY MAGAZINE
Front Cover Section ISJ47.indd 1 03/06/2010 20:37 Editor Brian Bollen Welcome to a new look ISJ and welcome to new people on our own team as Brian [email protected] Bollen is appointed Editor of the journal, working with Roy Zimmerhansl our E-in-C, and Clive Gande chairs our new advisory board. Both need little introduction as readers of the Advisory Board Chairman Clive Gande FT will know Brian’s incisive style, and Clive’s knowledge of custody issues and people is clive.gandeISJ.tv familiar to many who came across him at BNY Mellon. ISJ launches its first European Senior correspondent Custody Summit in July which is complemented by another inaugration; that of our Craig McGlashan double-sided - or two-faced? - issue. If you flip this ISJ over you will find our review of key [email protected] markets in European Custody. US correspondent Enjoy the writing, John Sandman our US correspondent guides us through corporate John Sandman actions and SDA, we profile the legendary Mark Mobius and Euroclear’s John Trundle [email protected] formerly a central banker looks at how we should regulate from here to regain capital Special correspondents market confidence. Cherry Reynard Anthony Harrington Mark Latham, publisher Head of sales Patricia De La Grange CONTENTS [email protected]
Account managers 4 swings and roundabouts New People, New Positions Cicely Lewis HSBC SS Joint Heads [email protected] The HSBC Six Eradat Munshi Colle BP2S appointment [email protected] Vanderweyen leaves RBC Wallace Takes Charge CTO Mustoe Goes Perpetual Peter Ainsworth [email protected] Andy Hughes Joins Omgeo Operations manager Nicolette Whittaker 8 news review African Custody [email protected] Barclays and Standard Chartered Editor-in-Chief Roy Zimmerhansl [email protected] 12 US focus Outsourcing by John Sandman Managing director Jon Hewson [email protected] 14 US focus Technology, Same day affirmation, ISITC Boston Publisher Mark Latham 16 US focus Corporate Actions by John Sandman [email protected]
2i UK One Angel Wharf, 59 Eagle Wharf Road 18 Under the Microscope UCITS VI London, N1 7ER, UK T: +44 (0) 20 7183 7470 F: +44 (0) 20 7250 0350 26 The ISJ Profile Mark Mobius Templeton Investments 2i US 410 Park Avenue, 15th Floor, New York, NY 10022 T: +1 212 231 8421 30 Regulation OTC Derivatives, Market Risk in EU F: +1 212 231 8121
© 2010 2i Media. All rights reserved. No part of this publication may be 32 Technology Releases reproduced, in whole or in part, without prior written permission from the publisher. Thomson Reuters Elektron / BNY Melllon Dashboard ISSN 1744-151X 1
1-47 main text Final ISJ47.indd 1 04/06/2010 21:08 contents Continued
33 Analyse This Automation 34 Fund Focus on Cyprus - sponsored section 36 The ISJ Profile Gary Probert Nordea Bank 38 Restoring Confidence to our Capital Markets by John Trundle, Chief Risk Officer at Euroclear 40 gains and losses Mandate News John Lewis JP Morgan JP Morgan Hewitt Mandate KLP Northern Trust Mandate Citi Japan Mandate Quis Custodiet? RBC Singapore Mandate BBH Win Underlines Renewe UOBAM Turns To BNYM BNYM Seadrill BNYM and Fuh Hwa 44 out and about Pugilism and Paintings 48 Directory of services
European Custody is the flip side of this issue of ISJ
Christoph Wetzel, Ulf Noren, Global Head managing director of of Sub-Custody at SEB CACEIS Bank Deutschland EurOpEaNCustody Custody services with a broader horizon European Custody Landscape Are you looking for a single point of entry to the Nordic and Baltic region? Or do you have your eyes set on a specifi c local market? Nordea is the leading Nordic custodian and Germany 2 the only truly Nordic player with well-established banks in Finland, Denmark, Sweden and Norway as well as a strong presence in the Baltic countries. Southern Europe 4 Angelos Gregoriades, Head of Tax and Corporate Services of A dedicated relationship manager supported by a specialist team will always be able to offer Central & Eastern Europe 8 KPMG Cyprus you a winning combination of regional competence and local insight. Our size, experience and Nordic region 16 connections with key players make us a sustainable provider in the evolving Nordic and Baltic securities markets. Spotlight on: Cyprus for private equity and To capitalise on our expertise, please contact Ms. Anne-Lise Kristiansen, tel +47 2248 6238, email: [email protected], hedge funds 12 Ms. Nina Groth, tel +45 3333 6124, email: [email protected] or Dieter Bernhard, head of Domestic Custody Services Mr. Teemu Pihlatie, tel +358 9 165 51008, email: [email protected]. for Deutsche Bank in Germany
2 nordea.com Making it possible
1-47 main text Final ISJ47.indd 2 04/06/2010 21:08 32051_Custody_210x297.indd 1 19.12.2008 15:11:14 Nordea Bank
Custody services with a broader horizon
Are you looking for a single point of entry to the Nordic and Baltic region? Or do you have your eyes set on a specifi c local market? Nordea is the leading Nordic custodian and the only truly Nordic player with well-established banks in Finland, Denmark, Sweden and Norway as well as a strong presence in the Baltic countries.
A dedicated relationship manager supported by a specialist team will always be able to offer you a winning combination of regional competence and local insight. Our size, experience and connections with key players make us a sustainable provider in the evolving Nordic and Baltic securities markets.
To capitalise on our expertise, please contact Ms. Anne-Lise Kristiansen, tel +47 2248 6238, email: [email protected], Ms. Nina Groth, tel +45 3333 6124, email: [email protected] or Mr. Teemu Pihlatie, tel +358 9 165 51008, email: [email protected].
nordea.com Making it possible
1-47 main text Final ISJ47.indd 3 04/06/2010 11:41 32051_Custody_210x297.indd 1 19.12.2008 15:11:14 swings and roundabouts New People, New Positions
Recent bulletins to emerge managementappointments atCitigroup s markets great appointments for from BBH s Boston redoubt to its New York team. and banking group. our business. The recent related the appointment of Scott Karp has been His most recent roles hires are in line with our Shawn R. McNinch, Senior included the market risk strategy to build on our Vice President, as Global management responsibility current success and grow ETF Product and Sales of the Municipal and Rates our business, allowing HSS Head. Before joining BBH business (swaps, OTC and to more effectively support in late 2009, Mr. McNinch exchange-traded options, our clients as they navigate worked at Barclays Global structured note creation, the current environment by Investors (BGI) where he mortgage pass-through adding to our capabilities was a Senior Principal within hired as the Head of Fund trading, government and and strengths . the iShares (ETFs) Product Accounting and Financial agency trading). Strategy Group. Reporting in the US. Osidach is responsible Congratulations Thomas Higgins joined the for the accurate and Patrick Colle business in April 2010 as timely delivery of all fund Head of the Regional Pricing accounting services Team Americas, reporting delivered to alternative to Karp. fund clients. With 18 Roman Osidach recently years of fi nancial services joined the Fund Services experience, his most recent BNP Paribas Securities Mr. McNinch worked on team as a Senior Fund role was as an Executive Services (BP2S) has lined numerous strategic initiatives Administration Manager Director, Portfolio Services up Patrick Colle as CEO to for the iShares business reporting to Karp. Manager for Morgan Stanley succeed Luxembourg-born ... and climbing. including assisting with the Gregory Cahaly was hired supporting the alternative Jacques-Philippe Marson. launch of new ETFs, working as US Head of Operational investment team in their fund Patrick joined BP2S in 2006 on the development of an Risk at the start of the of hedge funds and private and has been Head of its ETF distribution strategy, year, reporting to Marianne equity/real estate fund of UK business since March conducting a technology Motley, Fund Services Chief funds business. 2008. Jacques-Philippe assessment to position Administration Offi cer. Cahaly is responsible Marson was quietly but business for ETF growth, Gerald Donaghy was for ensuring that an summarily removed from his and assessing numerous recently hired as a Global effective framework is in post several months ago in new business opportunities. Tax Manager, reporting to place to further manage a manner which has never Also in March, BBH John Crager, Global Head and mitigate operational been satisfactorily explained, confi rmed the expansion of Tax Fund Services - risk. His appointment but which some say relate of its securites lending Alternatives. additionally enhances the to taking part in non-BP2S presence in Asia, assigning Robert Crowley has joined current team. With over commercial activities. Patrick Robert Lees and Richard the Fund Services team as 14 years in the fi nancial Colle has over 24 years of Meek to the Hong Kong Head of US Tax Reporting services industry, he was experience in the industry, offi ce, in the respective for the fund services most recently with Citi- of which four within BNP roles of Head of Securities business, responsible for the Global Wealth Management Paribas Securities Services. Lending Trading and Head US tax reporting of global Investments as a Director of As head of the UK business, of Securities Lending clients. Risk and Compliance with he has led BNP Paribas Relationship Management Karp is responsible for the the Portfolio Management Securities Services for the Asia Pacifi c region. accurate and timely delivery Group. successful development Mr. Lees reports to Jeff of all fund accounting and With over six years in this key fi nancial centre. A global player in asset servicing... O Neill, Global Head fi nancial reporting services tax experience, with his Prior to this, Patrick of Securities Lending delivered to alternative primary focus on the asset Colle was at JPMorgan Offering leading value in investor services demands constant Trading, and Mr. Meek to fund clients serviced from management sector, Chase which he joined in evolution. At CACEIS, our strategy of sustained growth is helping Elizabeth Seidel, Global the US. He joined at the Donaghy will be providing 1986 and where he held Head of Securities Lending end of 2009 and reports tax reporting services to several positions in cash customers meet competitive challenges on a global scale. Find out Relationship Management, to Tanya Nystrom, US HSS global fund clients. management, securities how our highly adapted investor services can keep you a leap ahead. Business Development Country Head. Karp has Prior to joining HSS, clearing and custody in Strategy and Marketing. spent approximately 19 Donaghy was a tax manager Paris and New York before CACEIS, your comprehensive securities servicing partner. Both work closely with years in the fi nancial in Ernst & Young s Financial becoming Global Head of Services Offi ce where he ADRs in London in 2001. Andrew Tucker, Partner, who services industry and www.munier-bbn.com is responsible for the Asia was previously Director of concentrated on hedge Pacifi c region and BBH’s Financial Accounting and fund, fund of fund and Markets business, which Reporting for a multinational international clients. includes Global Securities private investment fund Crowley, who reports to Custody-Depositary / Trustee Lending. group. Prior to that he Crager, has over 14 years was a senior manager at experience with the Big Four Fund Administration Six Of One, Half A Dozen PricewaterhouseCoopers. public accounting fi rms. Laurent Vanderweyen is Corporate Trust Of The Other Higgins has been in the Scott Epstein, Head of leaving RBC Dexia Investor CACEIS benefits from an S&P AA- rating HSBC Securities fi nancial services industry Fund Services and Global Services SA in Luxembourg, Services (HSS) has for 14 years having spent Custody Americas for where he was Managing www.caceis.com announced the following the majority of his career HSBC said: These are Director and Chairman of 4
1-47 main text Final ISJ47.indd 4 04/06/2010 11:41 Caceis adv climb EN 203x267H.indd 1 14/08/09 17:06:31 ... and climbing.
A global player in asset servicing... Offering leading value in investor services demands constant evolution. At CACEIS, our strategy of sustained growth is helping customers meet competitive challenges on a global scale. Find out how our highly adapted investor services can keep you a leap ahead. CACEIS, your comprehensive securities servicing partner. www.munier-bbn.com
Custody-Depositary / Trustee Fund Administration Corporate Trust CACEIS benefits from an S&P AA- rating www.caceis.com
1-47Caceis main adv text climb Final EN ISJ47.indd 203x267H.indd 5 1 14/08/0904/06/2010 17:06:31 11:41 swings and roundabouts New People, New Positions
the Executive Committee. engagement with clients. to work with CEO James He will join J.P. Morgan As Group Head of Robertson in his role as a Bank Luxembourg as Corporate Finance, Sean led Senior Managing Director General Manager in July. the business in delivering of Invesco and as part In that role he will have record performances. For of the Invesco Perpetual executive responsibility for the full year 2009, Corporate management team. the Luxembourg office, will Finance delivered 74% year- Karim Ben Rais joined serve as a Board member on-year growth, underpinned Euroclear as Managing of J.P. Morgan Bank by the rollout of new Director and Head of its Luxembourg, and will lead products and geographic Single J.P. Morgan s Worldwide expansion. Platform Modules division Securities Services business Before joining Standard in early May. Prior to joining in Luxembourg. Chartered Bank, Sean Euroclear, Karim Ben Rais Wallace was Managing Andy Hughes: From worked internationally as Director at JP Morgan where Microsoft To Omgeo an independent consultant. he spent almost 10 years. Omgeo announced the Until the end of 2007, he At JP Morgan, he was the addition of Andy Hughes was Managing Partner Head of Capital Markets, to the position of executive of Accenture Insurance Wallace Takes Charge: Asia Pacific and before director, partners. This Services, where he was Standard Chartered names that was the Co-Head of strategic hire marks responsible for all technical Sean Wallace as Group Investment Banking, Asia Omgeo s commitment to and operational services for Head of Origination and Pacific ex-Japan. Before facilitating end-to-end trade the Accenture unit and more Client Coverage (OCC) transferring to Asia, Sean processing by partnering than 2,000 staff located in Standard Chartered, was head of JP Morgan s with leading independent on- and off-shore locations. incoming £20m a year North American Telecom software vendors (ISVs) and At the start of his career shirt sponsor of up-for-sale Group. Sean graduated from technology providers around in 1987, Ben Rais joined Liverpool Football Club, has Harvard College with an A.B. the world. Accenture (previously appointed Sean Wallace as in History and Economics Hughes joins Omgeo Andersen Consulting) Group Head of Origination (more usually described from Microsoft Corporation, where he spent more than and Client Coverage (OCC) as Bachelor of Arts) and where he held a variety of twenty years working on with immediate effect (April holds an MBA from Harvard positions. Most notably, cost reduction, operational 19 2010). Business School. he was responsible for the performance improvement, Reporting to Mike Rees, creation and execution of supply chain and IT CEO of Wholesale Banking, a global partner strategy transformation programmes, Sean will lead the Bank s across financial services. as well as off-shore Origination and Client This covered the selection arrangements. Coverage Group, which and recruitment of ISVs and shapes the client-centric systems integration partners strategy of deepening client Mustoe Goes Perpetual to create high margin, relationships across its key Invesco Perpetual has solution based revenue markets. He will continue to named Nick Mustoe as streams built on Microsoft s be based in Singapore. its new Chief Investment core technology platform. Sean succeeds V Officer (CIO). Nick will take He also worked extensively Koger, Inc. releases latest Shankar, who has been up his new role on 7 June on developing partner version of NTAS in time for appointed the Bank s CEO, 2010 and will work closely based solutions focused Fund Forum in Monaco. Middle East, Africa, the with Invesco Perpetual s on the buy-side of capital Koger, Inc., a provider Americas and Europe. current CIO Bob Yerbury to markets, especially in the of software and services Commenting on the ensure a smooth transition areas of order management, for the fund administration appointment, Mike Rees, of responsibilities. portfolio management and industry, has launched the CEO of Wholesale Banking, Nick has over 25 years accounting systems, and next version of NTAS, its Standard Chartered Bank, experience as an investment trade compliance. transfer agency solution. said: We are pleased to professional starting with Prior to Microsoft, Hughes NTAS 10.1 introduces a be able to draw from such Phillips and Drew Fund worked at Bloomberg number of enhancements a strong internal pool of Management as a UK Equity in sales and sales and new features that talent. Sean has been manager and more recently management, as well as expand the tools available to instrumental in accelerating as CIO of Pictet Asset Dow Jones Telerate in the administrator making the the growth of our highly Management, where he was sales and sales support. fund administration process successful Corporate responsible for the equity He holds an Honours more robust, faster and Finance business. Sean s investment teams, and Degree in Business Studies more automated. focus and commitment CIO of Hermes Pensions and a Chartered Institute We are very pleased to Standard Chartered s Management, where he of Marketing Diploma. with the enhancements and clients make him an ideal was responsible for all asset Hughes is based in Boston new features in NTAS 10.1. choice for this key role. His classes including equities, and reports to Tim Keady, Our customisable workflow international background fixed income, property and managing director, global screens make NTAS even and industry experience will alternatives. sales and relationship more user-friendly , says further enhance our strategic Bob Yerbury will continue management at Omgeo. Ras Sipko, COO. 6
1-47 main text Final ISJ47.indd 6 04/06/2010 11:41 ISJ47 complete text Jun02.indd 7 03/06/2010 22:59 ISJ 267x203_28May:BP2S Ad 28/05/2009 11:53 Page 1
news review African Custody BNP Paribas Securities Services THE CLOSER WE ARE, THE BETTER YOU PERFORM Barclays Exits African Custody: End Of An Era? With our precise understanding of each market’s internal workings, you maximise your market and investment opportunities. Does Standard Chartered s agreement to acquire the Malawi, Morocco, At BNP Paribas Securities Services, the closer, the better. African custody business of Barclays Bank mark the end of Namibia, Nigeria, Tunisia and South Africa) provided through an era, one that still resonates with echoes of colonialism? a network of third party sub-custodians via an operations Those will likely be the fi rst thoughts of anyone of an age hub in Mauritius. The new business will strengthen Standard advanced enough to remember the days when the names Chartered s regional product offering for both international of those two institutions were synonymous with banking in and regional businesses, strengthening client relationships, exotic markets. In fact, older observers say they recall the whilst providing an additional source of liquidity to the Group. words colonies and dominions were still being rather freely Rapid Development Plans bandied around in the early 1980s. But maybe it s the effects Commenting on the deal Karen Fawcett, Group Head of of growing senescence as they inch towards their twilight Transaction Banking at Standard Chartered, said: We are years, and their thoughts turn away from White Mischief and very pleased to have secured the acquisition of Barclays towards stairlifts, bath chairs and ear trumpets. African Custody business. This deal will enable Standard Or is Barclays just doing what most banks eventually do? Chartered to rapidly develop our custody capabilities in our Flog off a business that has become a bit of an orphan, core markets across Africa. We are already seeing ongoing even an embarrassment, demand for regional and international investment services “We will work to concentrate on gouging across this region. Standard Chartered remains committed closely with Standard real money out of the to providing clients with an integrated set of solutions that developed markets? promote ongoing growth of this industry. With this acquisition, Chartered to ensure Hard-working staff in the we will enhance our custody offering and continue to gain a the transition does credit card division s fraud strong foothold as Core Bank to our clients in Africa. investigation service, after Barclays Bank PLC s not impact our all, having contributed to the The African custody African custody business has clients and employees Barclays Group s reported business forms a been consistently recognised £11.6bn profi t in 2009 by as the Best Custodian Bank and remain fully reducing fraud by around key part of Standard in Africa. The world s most committed to 28% in a single year, found Chartered’s build- jaded cynics might argue themselves rewarded with that this is like being voted growing our banking the transfer of a number of out of international the best looking member of operations in Africa.” core jobs to India. Barclays custodian services, Wayne Rooney s family, but stated, incidentally, with a awards are awards, and facts straight face, in notices to its staff breaking the news, that alongside existing are facts. this formed part of its plans to create a global centre of fraud capability in Asia and Barclays says that the excellence. Why soldier on with a business that is probably African custody business time-consuming and labour-intensive, and needs signifi cant the Middle East. had gross assets of £1.9 investment to deliver even a meagre return, when much million and assets under easier pickings are to be had elsewhere? custody of £3,862 million as at 31 December 2009. The sale is expected to be completed in 2010, subject to regulatory Pop-Eyed Optimism approvals and other customary conditions. Barclays exited The press release announcing the transfer of the custody the global custody business outside Africa in 1998. It says business touches upon none of this speculative context, the remaining custody business in Africa is profi table but of course. Rather, as is par for the course, it views the would benefi t from the synergies a global operation could deal with the kind of pop-eyed optimism that Hugh provide. The sale realises value for its shareholders while Laurie s character exhibited in Blackadder Goes Fourth, not impacting Barclays long-established banking business in defending the eponymous hero against charges of being Africa, it The Flanders Pigeon Murderer. Standard Chartered states explains. Vinit Chandra, Chief Executive, Barclays Africa that the transaction will provide it with custody capabilities said: We will work closely with Standard Chartered to in its markets across Africa (which qualifi es handsomely ensure the transition does not impact our clients and as a statement of the blatantly obvious). It adds that employees and remain fully committed to growing our the acquisition is subject to certain regulatory and other banking operations in Africa. approvals, though even after much head-scratching it is Standard Chartered says that the acquisition is another diffi cult to see (a) who could possibly object and (b) who else demonstration of the signifi cant investment it has been would possibly want to buy it. Standard making in its African franchise over the last few years, Chartered says it expects the deal to be completed in 2010. following its recent purchase of First Africa (a leading African securities.bnpparibas.com The African custody business forms a key part of Standard mergers and acquisitions advisory business) in 2009, and Chartered s build-out of international custodian services, the opening of its new representative offi ce in Angola, its alongside existing capability in Asia and the Middle East. fourteenth African market in early 2010. We wish them The acquisition adds direct custody capabilities in eight nothing but the very best in their renewed endeavours, African markets (Botswana, Ghana, Kenya, Mauritius, likewise to Barclays as it looks ahead rather than back, and Tanzania, Uganda, Zambia and Zimbabwe) and indirect we look forward to having any jaundiced interpretations of the deal being duly rebutted. ISJ BNP Paribas Securities Services is incorporated in France with Limited Liability and authorised by the French Regulators (CECEI and AMF). BNP Paribas Trust Corporation UK capabilities in a further eight markets (Egypt, Cote d Ivoire, Limited and Investment Fund Services Limited are authorised and regulated by the Financial Services Authority. BNP Paribas Securities Services London Branch is authorised by the CECEI and supervised by the AMF and subject to limited regulation by the Financial Services Authority. Details on the extent of our regulation by the Financial Services Authority 8 are available from us on request. BNP Paribas Securities Services is also a member of the London Stock Exchange.
ISJ47 complete text Jun02.indd 8 03/06/2010 22:59 ISJ 267x203_28May:BP2S Ad 28/05/2009 11:53 Page 1
BNP Paribas Securities Services THE CLOSER WE ARE, THE BETTER YOU PERFORM
With our precise understanding of each market’s internal workings, you maximise your market and investment opportunities. At BNP Paribas Securities Services, the closer, the better.
securities.bnpparibas.com
BNP Paribas Securities Services is incorporated in France with Limited Liability and authorised by the French Regulators (CECEI and AMF). BNP Paribas Trust Corporation UK Limited and Investment Fund Services Limited are authorised and regulated by the Financial Services Authority. BNP Paribas Securities Services London Branch is authorised by the CECEI and supervised by the AMF and subject to limited regulation by the Financial Services Authority. Details on the extent of our regulation by the Financial Services Authority are available from us on request. BNP Paribas Securities Services is also a member of the London Stock Exchange.
ISJ47 complete text Jun02.indd 9 03/06/2010 22:59 Investor Service Journal 27/04/10 14:14 Page 1
news review African Custody
In Conversation With... Giles we have seen in Asia or the Middle East over the past three to four years. Elliott, Global Product Head, Securities
Services, Standard Chartered Bank ISJ: Surely Africa is so poor that even a large business there is small beer by standards elsewhere? Giles Elliott: In relative terms you are correct, however, A new word for ISJ: How much did the complexity of the environment makes the margin Standard Chartered pay opportunities attractive. Africa is a significant contributor to for the business? Standard Chartered s performance with 7% of our revenues Giles Elliott: I am afraid and 9% of our profits coming from Africa. Africa is a $1.1 cross border this information is billion business for Standard Chartered and growing at a confidential and has not rate of over 20%. We feel that this is an important client been disclosed. We felt segment in Africa and therefore key to our growth agenda on that the business was this continent. Standard Chartered is present in 14 countries great value to us not in Africa, with over 600 staff and 170 branches. We recently only in terms of filling opened an office in Angola as we continue to deepen our an important gap in our Giles Elliott, commitment to growing this business in Africa.
network coverage, but Global Product ISJ: By how many years does this accelerate SC s most importantly in terms of Head, Securities growth plans in Africa? the staff that we will bring Services, Standard Giles Elliott: Within the Securities Services business, we had into Standard Chartered Chartered looked at different entry options for Africa and recognised and the depth of client that the business between players is largely stable. An base across Africa and organic entry option would have taken many years to internationally. We see this execute growth to a material size and we saw merits in a business growing strongly and becoming an important growth faster time to market, especially with the depth of interest sector across our banking services in Africa. that we are seeing from investors seeking greater African ISJ: What is the amount of assets under custody? exposure.
Giles Elliott: The acquisition will include $6.2 billion of client ISJ: Who initiated the deal? Standard Chartered or assets across 16 markets. We will look to take on all 66 staff Barclays? employed by Barclays. Giles Elliott: Standard Chartered and Barclays had discussed ISJ: Is it just custody or are there other services this business in early 2009 and Barclays initiated the sale involved? process later in the year. We saw this as a perfect fit against Giles Elliott: It is primarily custody, and includes sub-custody our strategy and business focus, and Barclays is a bank with to foreign brokers and global custodians, local custody to strong cultural alignment to our own that would make clients domestic funds and insurance companies and regional and staff transition more easily.
custody to foreign investment funds and other local funds ISJ: Were there any independent advisers involved? investing across Africa. Giles Elliott: None that played a notable role. We have a ISJ: What on earth is the attraction? strong Group Corporate Development function in-house.
Giles Elliott: There are three core reasons for this acquisition: ISJ: Are you still on the lookout for further acquisition i. It fills an important strategic gap for us. The Bank’s opportunities? focus is to be the leading banking in Asia, Africa and the Giles Elliott: We are very much open to more acquisitions Middle East for targeted client segments. This covers if they align strongly with our strategic agenda and priority investors locally, investors from these regions and investors focus areas. Our strategy is very clear and our core growth investing into these regions. We are building our business will be organically driven, but we are absolutely focussed on footprint in the Middle East organically, but had a gap in leveraging opportunities that give us acceleration along the Africa and this presented a special opportunity to accelerate strategic path that we have set.
our entry with a leading client base; ISJ: How long will the integration take? ii. Our focus is to leverage the depth of our banking Giles Elliott: Integration will be finished before the end of the services in Africa to provide a unique set of investor year, and will involve clients transitioning onto our core IT solutions. The expansion of our financial markets platforms and staff joining Standard Chartered.
business in Africa in the last 2 years has already seen ISJ: What areas will need most attention? growing opportunities and demands from the investor Giles Elliott: We do not feel that there are any notable client segment, and coupled with the depth of our cash areas that need urgent attention. This is a very well run and FX capabilities we are able to bring to the table a business, with strong staff and excellent client service comprehensive set of investor solutions. Euroclear is making cross-border settlement an obsolete term. We will help clients disciplines. We will be migrating the clients onto our core iii. Africa is evolving rapidly and we have seen extensive platforms so clients will see the same benefits from this reduce their back-office costs, risks and complexities with our multi-currency Single investment in markets infrastructure, pension fund and with our Straight 2 Bank web instruction and reporting Platform, spanning a wide range of securities and markets. Together with harmonised reform and growth of the capital market sector. There is capability. Naturally client integration will take a lot of focus a gradual shift away from the debt markets to equity as a during the year, but we have seen excellent feedback to the market rules and practices, all markets covered by Euroclear will operate as one. mechanism for financing growth and the stronger capital deal and clients recognise the commitment that Standard Eliminate cross border from your settlement vocabulary. markets infrastructure is driving more confidence in this Chartered has for this business and future benefits that we area. This has translated into higher growth rates than can bring to the table. ISJ © 2010 Euroclear SA/NV, 1 Boulevard du Roi Albert II, 1210 Brussels, Belgium, RPM Brussels number 0423 747 369 10
ISJ47 complete text Jun02.indd 10 03/06/2010 22:59 Investor Service Journal 27/04/10 14:14 Page 1
A new word for cross border
Euroclear is making cross-border settlement an obsolete term. We will help clients reduce their back-office costs, risks and complexities with our multi-currency Single Platform, spanning a wide range of securities and markets. Together with harmonised market rules and practices, all markets covered by Euroclear will operate as one. Eliminate cross border from your settlement vocabulary.
© 2010 Euroclear SA/NV, 1 Boulevard du Roi Albert II, 1210 Brussels, Belgium, RPM Brussels number 0423 747 369
ISJ47 complete text Jun02.indd 11 03/06/2010 22:59 FAX_Fullw_ISJ_081309.qxd 8/13/09 3:06 PM Page 1
US focus Outsourcing
Outsourcing for Investment Managers, Pack Your Bags, Powerful corporate actions solutions Visit Your Vendor by John Sandman for a complex world
Outsourcing has at once become a fixture in the From Maybe To Must Have financial services industry yet one that continues to mature “Outsourcing is crucial to the success of hedge funds and evolve at the same time. Investment operations have and other alternative investment companies because of As the most experienced vendor in the industry, increasingly become an opportunity both for some providers the increasingly important issue of independence in the and firms, as investment managers seek solutions that aren’t wake of the recent financial crisis, the Madoff scandal available in-house. and the current political climate. If they don’t outsource Fidelity ActionsXchange has delivered flexible, technology-driven Some of the most significant stumbling blocks are en- the administrative function, which includes independent countered at the start of the project, something that can valuations, then investors may not look at allocating to corporate actions solutions to the worldwide financial services needlessly extend the timeline. Investment managers who such funds,”says Andrew Rubio, chief executive officer of Throgmorton, a specialist provider of outsourcing services marketplace for more than 10 years. contract with outsourcing firms should make sure they are to the industry. vendor-ready before work begins. “They need to rebuild trust and it makes sense to outsource as part of their efforts in that direction. The Defining Touch Points question of outsourcing has gone from ‘maybe’ to ‘must’. “Defining the touch points between the two organisations, Fund administration work that has been done internally Leveraging our unparalleled expertise, technology the testing strategy and having an equal involvement from must now ideally be done externally, as the use of external the stakeholders is key, said Steve Reydel, Boston-based administrators ticks a very big box for asset allocators.” and service, we offer solutions that source, enhance, compare and head of State Street Bank’s global programme office, at the International Securities Association for Institutional Trade is still trying to figure out how to play in each size. We’ve validate corporate action announcements, giving our clients the Communications forum and vendor show in Boston on come a long way in a couple of years and there s been March 22. Stick to the agreed model. Once we get started success across the board, confidence that this is happen- highest degree of control over their global event information. “Defining the touch and the client comes to us ing. We re in a large market that s more complex, so we with changes to things that we create different versions of that product. points between the believed were resolved, a lot two organisations, of risk is created. Watch Out For Duct Tape If the client onboarding Regardless of the size, outsourcers are likely to confront the testing strategy process takes longer than similar continuity problems. “You will find gaps in workflow and having an equal expected, critical staff could and process, said Schena. There are still lots of duct tape Work with a recognized leader and trusted partner to: move elsewhere by the time and manual workarounds for workflows that didn’t work out.” involvement from the the project gets underway, stakeholders is key,” Component outsourcing has emerged as an alternative to leading to the unplanned ad- full service or a one-size-fits-all approach that is especially REDUCE COSTS | MITIGATE RISK | INCREASE CONTROL said Reydel dition of temporary resources problematic and possibly more delay. The with clients of differing size. Some firms only do component client has to be ready, said Patrick Schena, principal of outsourcing. For example, portfolio record keeping for an ENHANCE TRANSPARENCY | GAIN EFFICIENCIES Headstrong, a Boston-based outsourcing firm. “Think about investment manager’s back office is a key function. Some the expectations and time horizon. If the time frame is the firms will only out source components on the back end of next 12 months, you re probably trying mainly to get cost re- that and not always to same service providers. lief. We encourage a three- to five-year horizon. Don’t think State Street s Reydel mentioned transaction management about it in immediate terms. None of us wants to go through and reconciliation as opportunities for component outsourc- a second conversion in the time that was allotted for one. ing but added, As you get further into the accounting aspect Replication = Trouble and start to customise services, you have to normalise lots of Learn more at www.actionsxchange.com Even if investment managers outsource for all the right rea- data into that environment. Even on Requests for Proposals sons, they run into trouble if they try to replicate their current (RFPs) for component outsourcing, firms issuing those RFPs For more information contact us at 877.777.5838 environment, which is what caused the problems that led ultimately want a full range of services. You end up bidding them to seek an outsourcing solution to begin with. Losing on custody, fund accounting, transfer agent services on an a sight of the fundamental reason for outsourcing can move a la carte basis, he said. solution further into the distance. “One of the first questions I ask a prospective client is what the internal service level Standardisation Still An Issue agreements are between the front and back office,” said The attempt to standardise messaging across the trade Reydel. Knowing you can hand the project over to some- life-cycle, which has been going on for more than a decade one else and say ‘here is exactly what we expect a firm to and touches on trade execution at the front end to clearance reproduce is key. and settlement at the back, continues to be an outsourcing As outsourcing has expanded, firms that seek outsourced issue, especially when proprietary formats are used. solutions are no longer limited only to large institutions. If a message comes in that s not FIX, Swift or FpML, Service providers have to understand the differences be- we ll have to deal with it, said Reydel. He added that if the tween large and medium-sized firms, especially when acting inbound message is proprietary, the outbound message will as a solution provider for both. As you get smaller, the level require a workaround. It depends on the client s environ- of complexity has to come down, said Reydel. The market ment,” he said. “We have clients in the middle office space 12
ISJ47 complete text Jun02.indd 12 03/06/2010 22:59 FAX_Fullw_ISJ_081309.qxd 8/13/09 3:06 PM Page 1
Powerful corporate actions solutions for a complex world
As the most experienced vendor in the industry, Fidelity ActionsXchange has delivered flexible, technology-driven corporate actions solutions to the worldwide financial services marketplace for more than 10 years.
Leveraging our unparalleled expertise, technology and service, we offer solutions that source, enhance, compare and validate corporate action announcements, giving our clients the highest degree of control over their global event information.
Work with a recognized leader and trusted partner to:
REDUCE COSTS | MITIGATE RISK | INCREASE CONTROL
ENHANCE TRANSPARENCY | GAIN EFFICIENCIES
Learn more at www.actionsxchange.com
For more information contact us at 877.777.5838
ISJ47 complete text Jun02.indd 13 03/06/2010 22:59 US focus Technology, Same day affirmation, ISITC Boston
that have taken it upon themselves to be SWIFT-compliant. and portfolio management. If this is something that can t be Moving to a common platform and a common standard resolved in-house, outsourcing is something to consider. reduces our costs as well as theirs. There are likely some things that should never be out- Practical Advice sourced by investment managers. Near the top of the list, A practical course of action for investment managers? Pack said Schena, is trading and compliance. Probably any- your bags and visit your outsourcing service provider early thing that s client-facing shouldn t be outsourced, said he and often. Make sure you have a monitoring team in place said. Reydel suggested that a firm’s core competency and that has the support of management. anything propriety should not be outsourced, but everything else was on the table. I think trading could be outsourced, John Sandman, ISJ’s US Correspondent, has covered operations, but it depends on the strategy of the firm.” he said. “My compliance and technology in the securities and banking experience is that we ve found friction between trading desk industries in New York for 15 years.
SDA: Suddenly It Doesn’t Seem So Far Away by John Sandman
Although the tagline for the Same Day Affirmation panel building blocks that needed to be in place before moving to at the International Securities Association for Institutional a shortened settlement cycle. Trade Communication (ISITC) forum in Boston last March The catalyst this time around, Cutrone stated, was the went from the World Wrestling Federation to a wistful credit crisis of 2008 and the need to find ways to mitigate Lennon and McCartney tune, the underlying issue remained: risk. We know that there s going to be a new regulatory can Same Day Affirmation improve trade settlement in the landscape, he said. We want to re-introduce the concept securities industry and at what cost? What s the downside of that you need to look not only at the front office, but the maintaining the status quo as opposed to a proactive attempt middle and back office also. In the opinion of many, at risk reduction? And is same day matching o r a variant of shortening the affirmation period will make that happen.” it t he answer? Cutrone said SDA rates in the US have already gone to One of the primary Same Day affirmation involves around 36% from 21% five years ago, but added, “SDA will reasons for fails is verifying the details of a trade not happen without a mandate. You shouldn t be focusing between a broker dealer and the on same day but mandatory matching to settle. If you go securities lending institutional side of the market to a match-to-settle environment, do you have to have shorts on the day the trade took place, regulations in place to affirm matching? Having 11% of your ensuring that both sides agree trades unaffirmed in a match-to-settle environment is too on what is being traded before settlement. About 11% of burdensome. all the trades that settle are not affirmed prior to settlement date, said Hal McIntyre, managing partner of the Summit Dirty Data? Group, a New York-based consultancy. So we ve got a lot Most industry sources believe the necessary technology of questions about what that 11% consists of. One of the exists. Ironically, clean, normalised data, a part of almost primary reasons for fails is securities lending shorts - people any automated solution, was identified by panelists as a who have a securities lending transaction they can’t fulfill. piece that is consistently missing. Jeff Zoeller, VP of T. That causes fails. Rowe Price expressed his support for SDA along with a “Overall, the goal is less risk and more efficient processing,” concern about data quality. You have to make sure your said McIntyre. “But is same day affirmation really the data is clean and available early enough in the day. If a answer to increasing efficiency and removing risk? Should trade is executed today, it gets entered and shows up the we mandate this process or should a best practice be next morning to provide accurate trade information. Zoeller established with voluntary compliance? If a new approach also cited the need to support overseas clients in different surfaces, whether it s mandated or not, should it be provided time zones and that the loan recall process is a major on a central basis or bilaterally? Should the process happen cause of failure. There are still broker/dealers running on trade date through same day affirmation, or is it sufficient batch processing until after the close of the cycle, Zoeller to have it occur prior to settlement? noted. That s going to get in the way of same day matching. Mandating SDA raises the stakes in terms of the burden on Lurking In The Background the industry. Lurking in the background is the abandoned attempt to Russell Stamey, VP of operations and technology at move to T+1, or next-day settlement. Is the industry ready Northern Trust also had data concerns. One of the big to revisit a shortened settlement cycle? T+1 has been issues for custodians is that we are very dependent on discussed on and off ever since the late 1990s when the timely and accurate data, said Stamey. Performance market last considered it, said Lee Cutrone, New York- reporting, performance monitoring, securities lending, based manager of industry relations at Omgeo. At that corporate actions, cash management a ll these functions point, same day affirmation was identified as one of the are dependent on getting good timely data from investment 14
ISJ47 complete text Jun02.indd 14 03/06/2010 22:59 US focus Technology, Same day affirmation
managers. Before entertaining solutions, he said, We have to look at the true cost of handling manual transactions, of reclaims and DK trades. DK, or Don t Know, is a trade that has been uncompared and rejected. For me, the second piece is we need a pre-match settlement environment for US trades, said Stamey. And as part of that, we d be remiss if we didn t look at T+0 or same day affirmation or match as a best practice. But all this should be put in the context of the broader, longer term issue of shortened settlement cycles. Same Day Matching won t be easy, another pass at “I just don’t think T+0 notwithstanding. To do it right, Stamey said, I d like to see SDA will happen progress without a regulatory unless there’s a mandate to push it forward. But I think we also need some well- McIntyre mandate,” defined goals.”
Mandate Needed McIntyre suggested that, left to its own devices, the industry probably wouldn t willingly migrate to SDA and that a mandate of some kind was necessary. Some people look back to when we went from T+5 to T+3 and the settlement rates did not improve, said McIntyre. So many say that the people who were screwing up at T+5 just continued to screw up in T+3. If we have an SDA best practice, will those people change of their own volition? I just don t think SDA will happen unless there s a mandate, said Cutrone. Our industry hasn t shown a willingness to make short term sacrifices for long term benefits. What they’re really going to respond to the threat of regulation. That s the only thing that will get it going. Cutrone Canada is the first national “We have to look market to require same day at the true cost of affirmation, where it’s being phased in. Their fail rates handling manual have gone from 3 percent to 1 transactions” SHUFH W VDLG & XWUR H But I don t think anyone is arguing that this is completely attributable to same day affirmation.” The problem with Canada is that there is no penalty behind the mandate, said Zoeller. You have to make sure there s a matching requirement. Squeezing the definition of what constitutes a day will put further pressure on moving off T+3. If we stay in T+3, do we get any benefit from an earlier affirmation? Another way of looking at that is if we do same day affirmation, does it matter if we stick to T+3.”
Forcing The US Issue Reydel Overseas regulation may force the US to act. Omgeo s Cutrone noted that the EU, has been promoting a T+2 settlement cycle, parallel with the Target2 Securities settlement and has to harmonise settlement across the EU, with the German T+2 cycle being the driver. They have to go to T+2, Curtone said. T+3 would mean Germany would have to roll back their settlement cycle. Cutrone predicted that T+2 in the EU would force the US to adopt. The other tendency is to stand pat on the grounds that budgetary constraints remain significant. The cheaper it is to fail trades, said Stamey, the less incentive there is to change. Once the industry is forced to change, however, he saw a silver lining for firms with high touch processing. “Matching to settle is going to force SDA, said Stamey. Firms that start this from scratch won t have to take legacy systems out of Stamey production. ISJ 15
ISJ47 complete text Jun02.indd 15 03/06/2010 22:59 US focus Corporate Actions
XBRL, Swift and DTCC Take user can, based on the kind of corporate action they have, omit fields that are irrelevant and use mapping software Another Run at Automating that can automatically convert XBRL into ISO 20022, he said. There s also the possibility of creating templates in Corporate Actions by John Sandman standard Word documents. ISO 20022 captures the data of a security that will have Will the joint effort by XBRL US, Swift an impact on distribution of shares, the cash distribution a and the Depository Trust and shareholder gets or a combination, said Pryde. That s the information we re trying to collect. Included are stock splits, Clearing Corp (DTCC) to automate dividends, re-organisations, tender offers, mergers, bank- ruptcies t hings that affect distributions to stockholders or succeed where previous efforts failed? that affects the value of their holdings.
The industry is, once again, seeking an answer. In the Scrubbing Data past decade, various attempts have been made to auto- Corporate actions processing in the United States still mate these back office processes, only to be abandoned involves a routine of scrubbing data at the DTCC, where when new solutions were not equal to the task. While they securities are held and settled. In describing the data, Max fell short for a number of reasons, chief among them was Mansur, global market manager, Swift, said Today it s all the limitations of ISO 15022, the Swift messaging stand- proprietary. You go to a DTCC terminal and transform the ard which replaced ISO 7775 in 2002. As a source with data into your own format. knowledge of Swift put it, 15022 was a good start. It began “The firms that have the least amount of automation are the the automation process between the intermediaries, includ- investment managers and are the most used to handling About 200,000 ing custodians, transfer agents, manually processed data, said Mansur, adding, however, the fund administrators and their that the investment managers are not the sole laggards and corporate actions users. But 15022 never went the that the poor consistency and quality of data received from are announced each whole way." their custodians had a significant impact in general and in year in the U.S. Now Swift and the DTCC have the cost of automating corporate actions. joined forces with XBRL US to The DTCC would not comment on the extent of proprietary by publicly traded capture electronically corporate formats now in use. Robert Epstein, vice president of DTCC companies actions data from the offerors Asset Services said, The DTCC will publish corporate ac- or issuers at the point the an- tions announcements using the industry standard ISO 20022 nouncement is made in a standardised format. XBRL, or business modeling beginning in April 2011. Epstein added, the Extensible Business Reporting Language, is a standard “At the same time, support we support existing DTCC files based on the extensible mark-up language (XML), with data until a cut-off date in 2015 or sooner. elements known as taxonomies that are similar to the data elements in ISO 20022, which is also XML-compatible. The Unique ID two will inter-operate to form a corporate actions taxonomy As part of the process, the DTCC is creating a unique ID for to be used by the DTCC. About 200,000 corporate actions each corporate action announcement that will be understood are announced each year in the U.S. by publicly traded com- between the parties in the transaction. An issuer, for exam- panies, involving merger announcements, stock splits, bond ple, will be able to capture electronically data during a re- redemptions, dividends and other corporate events. organisation using a corresponding ID. The precise number of corporate actions the DTCC would support was not clear, Secret Sauce although a DTCC spokesperson said there were nearly one Whether or not XBRL is the secret sauce that was missing in hundred and that some will be more widely used than others. the past, the XML tag-based standard has come a long way The corporate action taxonomy does not include the proxy since being introduced as an accounting standard in 1999 statement, which typically contains a lot of alphanumeric under the aegis of the American Institute of Certified Public text. We have a separate taxonomy for proxy statements Accountants. that we ve been working on but it s not included in the corpo- It has become a reporting tool used by regulators worldwide, rate actions taxonomy, said XBRL s Campbell Pryde. The Our role is to with the Securities and Exchange way that has been prepared is based on looking at the proxy Commission mandating that statements and what s typically reported and what s required extend data, public companies file their 10K by law to report. We have a structure built up for the proxy. regardless of the reports in XBRL by 2011. Even if paper is the bane of the back office, Swift’s Mansur We are currently working stressed that We re not trying to retire all paper-based data. geographic domicile through the taxonomy which we The stakeholders, which include the transfer agents, the or format. want to release for public review exchanges such as New York Stock Exchange, the central in July, said Campbell Pryde, securities depositories, the broker dealers and fund manag- chief standards officer at XBRL US. “We’ll get feedback ers, have told us that they all want the same process, where from DTCC, Swift and the members of XBRL who will have electronic records will complement paper records. It will be 30 days to review it followed by a 90-day public review. The similar to what happened for financial reporting. Electronic goal is for the corporate actions taxonomy to be used in any data will have a paper counterpart which acts as a fail-safe jurisdiction. It s predominantly US-based now but there s no against potential litigation. reason it couldn t be extended elsewhere. We ve also added The narrative sections of a corporate action are where the functionality for the tax consequences of corporate actions. bulk of alphanumeric data is located and, in general, is the Pryde added, We have different entry points where the most resistant to automation. Mansur stated that for 95% 16
ISJ47 complete text Jun02.indd 16 03/06/2010 22:59 US focus Corporate Actions
of the CA messages, narratives aren t needed. The vast determine, for example, what the tax implications of an majority of those are found in the MT 564 and the 568 mes- event are, said Mansur. There will always be some aspect sage types. He described the 568s as being able to catch of a corporate action that cannot really be coded and will the narrative overflow from the 564s. require a manual solution. It s the redundant scrubbing of data that XBRL can eliminate. Taxonomy Taxonomy That doesn t minimise the need for automation, The corporate actions taxonomy does not necessarily cap- however. I hope eventually that the processing of corporate ture all the details and make them completely automatable, actions will start to resemble clearance and settlement, said XBRL’s Pryde. “Text fields that resist automation can be said Mansur. When you have cleaner, better data, it spells captured. You re never going to have a taxonomy with a list more efficiency and reduced cost. Ideally, the costs to of tags for every single thing possible. Whether corporate reconcile data and implement risk prevention will be actions are automated or not, Things slow down when you correspondingly lower. ISJ have to stop the process and read the corporate action to
In Conversation With While we believe the effort to standardise corporate actions announcements utilising common standards at the issuer source is critical, it is largely limited to the electronic tagging of data and does not address the scope of complexities involved in the interpretation, validation and analysis.
ISJ: Are translations or conversions from XBRL instance documents to ISO 20022 something that is or will be in demand? Is there likely to be an ongoing market for this or is it going to be commoditised once automation of corporate actions around XBRL and ISO 20022 becomes more widely implemented? POLLARD: While industry efforts to standardise corporate Laura Pollard action messaging should remain a critical imperative, these on ISJ.tv efforts represent only a partial solution to a comprehensive risk mitigation process. To further mitigate risk, firms need to access technology, tools and content expertise. This better positions the organisation to control, interpret, communicate Investor Services Journal caught up and take action on specific corporate events across multiple with Laura Pollard, Executive Vice businesses, related asset servicing and trading groups as well as other interested parties. We see little that would lead President of Cambridge, Massachusetts- us to believe the nature of corporate action events being based Fidelity Actions Xchange, who structured by issuing firms will decrease in the levels of chatted with John Sandman about their complexity. products and their support for automating ISJ: The DTCC says it has identified close to 100 different types of corporate actions. Which ones Corporate Actions does Fidelity support? Do you offer template-driven solutions? ISJ: Where does Fidelity sit within the XBRL-Corporate POLLARD: The world of corporate actions is not static and Action vendor scheme of things and what s your announcements are subject to increasing complexity not approach to supporting automation? limited asset class, presentation requirements and myriad POLLARD: We support multiple formats, including XBRL and other factors beyond pure data management. We do support will be ready to support the migration to 20022 protocols. Our all types of corporate actions and template-, business role is to extend data, regardless of the geographic domicile or rule and workflow driven solutions but again, we believe format, to support broader risk mitigation solutions delivering guidance, interpretation and understanding nuisances are greater levels of control, operational efficiencies and lower essential in analysing the complete picture. operational cost to our clients. XBRL represents a critical industry initiative to address ISJ: XBRL US and Swift have provided functionality a long-standing need to standardise and harmonise to automate the reporting of the tax consequences of information supporting a broad range of corporate a corporate action. Is this something your products disclosures, including those surrounding corporate action support? events. XBRL involves a standard process for electronic POLLARD: Tax information is increasingly complex as tagging of financial and related disclosure information issues of domicile, tax treaties, domestic and foreign and key data. Issuers can certainly support the electronic withholding and eligibility and new cost basis rules, tagging of traditional paper-based announcements and are constantly changing and involve highly specialised disclosure documents in-house, but frequently utilise XBRL skills As experts in corporate actions, we are working translation and tagging services provided by those firms who with tax specialists as best in market solutions to create support their traditional financial communication services. comprehensive, valued and effective tax support. ISJ
17
ISJ47 complete text Jun02.indd 17 03/06/2010 22:59 Under the Microscope UCITS VI
UCITS: Surprise, Surprise! * UDOH 6HFXULWLHV 6HUYLFHV L 3DULV The innovations that SGSS has already introduced to as something of a surprise to those It can come enhance its capabilities and product ranges in certain outside the financial services industry that some locations, including Luxembourg, illustrate the extent to investment houses only just become compliant with the which UCITS IV is impacting upon the industry. European Commission s UCITS III directive. There has The potential for change as a result of UCITS IV is vast. been so much talk in recent times of its successor, UCITS Asset managers could benefit greatly for at least four IV, and indeed early mutterings about the possibility of reasons. UCITS V as the appetite to regulate grows, that it can One, the newly simplified procedure to launch a cross- be easy for non-specialists to think the industry is further border fund in the European Union could remove advanced than it actually is. an entire layer of costs by reducing dependence on This is understandable. Investment managers and consultancy services. those who provide them with essential services and Two, in cases where asset managers opt to merge support, have long known that running fast in order funds across borders, they will need fewer staff to to stand still relative to their respective peer groups manage those that remain. is a fact of everyday life. This “This slow pace is Three, they will need fewer service providers, capable is arguably truer today than of providing securities services globally as well as part of the reason ever before. Given the events locally. that have affected the financial for the long-term Four, the new ability to leverage a single management services industry since July company across Europe will enable asset managers success of the 2007, it is a racing certainty to close down those domestic asset management that even as it finally becomes project.” companies that they have traditionally been required UCITS IV-compliant, a new set of to incorporate to comply with local regulatory requirements will soon be unveiled. Some believe that the requirements. industry will inevitably find its goalposts being shifted once more. Others, such as insists Jean-Michel Loehr, Chief In this environment, providers which understand how Industry & Government Relations at RBC Dexia, believe the industry will need to change to meet client needs will that the 20-year evolutionary process that has brought have a competitive edge. Those which haven’t, will find UCITS to the brink of its fourth incarnation will continue in themselves reconsidering their very presence in the new a slow and stately fashion. This slow pace is part of the landscape. UCITS IV, says Sebastien Danloy, will be a reason for the long-term success of the project, allowing step too far for some. appropriate levels of consultation to determine market needs, he says. Top Of The Agenda Looking at the other side of the equation, asset Centre of Attention managers rather than their service providers, the UCITS For the moment, though, UCITS IV remains the centre IV survey published by RBC Dexia Investor Services and of attention, and it is difficult to The potential for KPMG last autumn looks if anything even more relevant overstate its impact on investment today than when it first saw the light, insists Jean-Michel change as a result of management. It is nothing less Loehr. As we move further into the implementation than the trigger for much technical UCITS IV is vast. phase the complexities that we identified earlier are being and operational change around confirmed,” he commented to ISJ. “This is one of the top the world. Much has been written items on my own agenda. about the European Commission s UCITS IV directive in The main findings of the report, which shows how some recent months. Much more will be written before it comes of Europe s largest asset managers plan to capitalise on into effect (member states are required to implement it UCITS IV and identifies how these reforms will contribute by July 1 2011). Asset managers who haven t already to wider changes across the investment fund landscape, addressed the implications that the directive will have echoing and elaborating upon topics already noted above. for them, and what they will need to do to prepare They can be summarised as follows: the vast majority themselves fully, are already running out of time, warns of UCITS managers are taking a proactive approach 6HEDVWLH D OR JOREDO KHDG RI VDOHV DW 6RFL W to UCITS IV; the number of management companies 18
ISJ47 complete text Jun02.indd 18 03/06/2010 22:59 ISJ47 complete text Jun02.indd 19 03/06/2010 22:59 ISITC ISJ June:Layout 1 4/22/10 11:59 AM Page 1
Under the Microscope UCITS VI
will decrease; a new wave of fund mergers lies ahead; an important consideration. Master/Feeder structures will be key for new markets/ The study also revealed that 49% of respondents client segments; Immediate cost savings are expected. plan to restructure their fund ranges, with sub-optimal Peter De Proft, Director General of the European fund size and high costs to investors being key drivers. Fund and Asset Management Association (EFAMA), While UCITS IV will facilitate cross border fund mergers commented at the time, The fund industry is currently the market may also see a large number of new feeder facing numerous challenges in these turbulent economic funds which, as highlighted in the survey, will be used for targeted fund distribution and enable managers to enter CRAFTING THE vision FOR THE securities industry Hedge Fund Umbrella Launch new markets and segments. Again Luxembourg (81%) is the favoured location for consolidating assets in master/ feeder fund structures. Merchant Capital launched a UCITS III umbrella By far the most important advantage to UCITS structure earlier this year, designed to provide hedge IV for those asset managers polled is cost savings fund managers, including small- to mid-sized firms, with a (43%). Easier access to markets (24%) and increased seamless and cost-effective vehicle for running their own competitiveness (21%) were also highlighted as positive UCITS III funds. outcomes of the new framework. Only 2% of respondents Merchant Capital claims this will enable a faster route said that UCITS IV brings no advantages, while 45% to market for managers. Historically, it has taken between acknowledged the absence of a tax framework as a key three and six months to construct and bring to market a issue. UCITS product. Funds using Merchant Capital will take The survey polled 52 asset managers with UCITS funds established in their principal location in the European approximately four to six weeks, while also significantly Union (EU) as well as in the cross-border business reducing the high fees the process normally incurs and centres of Luxembourg and Ireland. The 52 asset fulfilling all necessary counterparty requirements. The first managers surveyed manage 54 % of the assets (UCITS user of the umbrella was unveiled as Tressis SV, Spain’s and non-UCITS) domiciled in the cross-border centres of leading independent distributor of investment funds, Luxembourg and Ireland. structured products, fixed income and other financial products. Embracing The Opportunity Hedge fund managers using Merchant Capital will not be It is clear that the market is already readying itself required to pay a standard minimum entry fee and will also to embrace this latest phase of UCITS and has made benefit from significantly reduced legal and administrative significant inroads in identifying the broad range of opportunities UCITS IV creates, commented Jean- costs. The UCITS III umbrella structure will also allow Michel Loehr, on publication. As ever, education remains the manager the freedom to seek competitive swap rates key to ensuring that the market continues to capitalise in the market place and take advantage of competitively- on regulatory changes. Vincent Heymans, Partner at priced agreements in place with some of the market’s KPMG in Luxembourg, and co-author, added: The leading providers. current economic environment has presented the fund Additionally, the company will enable investors and management industry with numerous challenges. It is managers alike to reduce the counterparty exposure therefore crucial that, now more than ever, fund managers inherent in partnering with a single institution; a manager fully realise the efficiency and consolidation opportunities The Essential Work of ISITC Continues. using an existing platform offering the full range of services found within UCITS IV, which allow for cost savings and under one roof can be subject to significant counterparty improved efficiency of operations.” But Regulatory Barriers Persist risk. Merchant Capital will supply hedge fund managers Following a more recent poll, the results of which were with all the controls and systems required to manage a announced out of Hong Kong in April 19, RBC Dexia UCITS III fund. As well as risk management and middle Investor Services said that despite the success of UCITS ISITC June 2010 Industry Forum & Working Groups office support, Merchant Capital also provides company funds in Asia, regulatory barriers continue to make local management, regulatory infrastructure and compliance market entry difficult for the fund industry. RBC Dexia’s June 6 - 8, 2010 oversight. latest industry poll also points to increased dependence on third-party service providers as a key trend for the Asia Four Seasons Hotel, Scottsdale, AZ Pacific fund industry in the wake of the global financial crisis. times that have Regulatory barriers to specific local market entry are a This conference will consist of Forums and Working Group Sessions. impacted assets under management and profitability major concern of the Asian Pacific fund industry, with 85% across the industry. One of the important strategic steps of respondents indentifying this as a significant challenge. Please visit www.isitc.org to register. for players in the UCITS industry is to fully explore how to Local laws and regulations across the region can make take advantage of UCITS IV. local market entry and cross-border fund distribution Don’t miss the chance to represent your firm and participate in Culling Companies complex and costly. The results highlight how managers will reduce the The success of UCITS in the region also shows no ISITC’s ongoing industry forums and working groups. number of management companies and will need to sign of slowing. In fact one in three (33%) respondents consider the location of a centralised management believed the upcoming implementation of UCITS IV would We look forward to seeing you in Scottsdale! company carefully, taking into account concerns make UCITS even more attractive. The flexibility, sound surrounding tax regime (49%), the regulatory framework regulation and strong brand reputation of these products (44%) and the availability of qualified personnel (33%). has won strong appeal in Asia as three-quarters of the poll Luxembourg (43%) and Dublin (18%) will be likely winners respondents either already offer UCITS funds (62%) or but also the location of the group headquarters (23%) is intend to do so in the near future (12%). FOR ADDITIONAL INFORMATION VISIT www.isitc.org 390 Amwell Road, Suite 402, Hillsborough, NJ 08844 20 Phone +1 (908) 359-1184 Fax +1 (908) 359-7619 E-mail [email protected]
ISJ47 complete text Jun02.indd 20 03/06/2010 22:59 ISITC ISJ June:Layout 1 4/22/10 11:59 AM Page 1
CRAFTING THE vision FOR THE securities industry
The Essential Work of ISITC Continues.
ISITC June 2010 Industry Forum & Working Groups June 6 - 8, 2010 Four Seasons Hotel, Scottsdale, AZ
This conference will consist of Forums and Working Group Sessions. Please visit www.isitc.org to register. Don’t miss the chance to represent your firm and participate in ISITC’s ongoing industry forums and working groups. We look forward to seeing you in Scottsdale!
FOR ADDITIONAL INFORMATION VISIT www.isitc.org 390 Amwell Road, Suite 402, Hillsborough, NJ 08844 Phone +1 (908) 359-1184 Fax +1 (908) 359-7619 E-mail [email protected]
ISJ47 complete text Jun02.indd 21 03/06/2010 22:59 Pension Funds Online ad:Layout 1 01/03/2010 15:24 Page 1
Under the Microscope UCITS VI
Third-Party Help Needed! future, most probably (12%) within in the next 12 months. Thiepoll suggests that third-party support is needed for When asked what their priority for improvement a fund manager to better understand the complexities was across the markets of Asia Pacific, over half of of local markets and to provide detailed local knowledge the respondents (56%) said fund distribution was their and expertise to guide them through the sometimes top priority. Fund administration and risk analytics and murky waters of cross-border or regional distribution, reporting were also important, mentioned by one in four argues Scott McLaren, Head of Asia Pacific Sales and (24-26%). Less important (15-18%) were custody, Distribution at RBC Dexia. It will become increasingly outsourcing support and transfer agency. important for service providers to become catalysts in www.pensionfundsonline.co.uk market evolution with the introduction of UCITS IV and Managing Expectations increased technology and automation becoming the Managing the expectations that are mounting about The Online Source for UK and standard. UCITS is an important consideration for George Cadbury, International Pension Funds The survey indicates the widespread adoption of third- Director, Merchant Capital, whose perspective is tilted party service (65%) amongst regional asset managers towards hedge funds. One of the asset management www.pensionfundsonline.co.uk is the online source for pension fund industry s major focal points this year has been the rapid www.pensionfundsonline.co.uk is the online source for pension fund It’s Official! increase in hedge fund managers implementing the information created by the publishers of Pension Funds and their Advisers UCITS is an important piece of legislation that is essential information created by the publishers of Pension Funds and their Advisers UCITS III fund structure for their own offshore investment (AP Information Services Ltd.) and the joint publishers of International to the integration of the financial markets in Europe and vehicles, he observed in a recent essay on the subject (AP Information Services) and the joint publishers of International Pension to the benefits of its citizens. European investors need to published in Investment Week. The adoption of UCITS Pension Funds and their Advisers (AP Information Services Ltd. and IPE have access to efficient and reliable savings products, all Funds and their Advisers (AP Information Services and IPE magazine). by absolute return managers has coincided with a period magazine). the more so with our ageing population. The UCITS label when confidence in what are regarded by some as opaque has become a great European success story, renowned for investment funds has never been lower. This innovative online product has been developed to compliment the its transparency towards the investor, its reliability and He pointed to a recent survey carried out by Kepler This innovative online product has been developed to compliment the use of both our pensions print directories Pension Funds and their performance Partners, an independent fund marketing and research use of both our pensions print directories Pension Funds and their even beyond Europe. adviser, which estimates that approximately $30 billion is Advisers and International Pension Funds and their Advisers. The objective of the fourth version of UCITS is to provide invested in hedge fund strategies that sit within a UCITS Advisers and International Pension Funds and their Advisers. a tool box to ensure the competitiveness of the European III structure. Official figures from the European Fund and asset management industry and to benefit European Asset Management Association show that the total global WithWith optionsoptions ranging fromfrom read-onlyread-only to to fully fully downloadable, downloadable, investors. It promises more choice, greater efficiencies and UCITS market stands at about $7 trillion. If we compare www.pensionfundsonline.co.uk gives you fully up-to-date information greater protection – at less cost. It will also reinforce the these overall market figures to the offshore market, www.pensionfundsonline.co.uk gives you fully up-to-date information on 6,500 UK and international pension funds at any time during your competitiveness of the UCITS label around the world. where there are over 10,000 hedge funds competing for on 6,500 UK and international pension funds at any time during your The general principles of the legislation (Level 1 measures) a capital pool estimated to be a little above $1 trillion, it 12-month subscription. have already been defined and approved by the European is clear why hedge funds managers are starting to take 12-month subscription. Parliament and the Council of Ministers. The outstanding UCITS seriously, he observes. These figures, twinned details of the implementing measures (Level 2) will now be with the fact that investing institutions and retail investors www.pensionfundsonline.co.ukwww.pensionfundsonline.co.uk gives you accessaccess to:to: discussed, with an objective to finalise the text by July 2010. are increasingly turning to UCITS as they seek the lower The directive will come into force in July 2011 after national volatility and higher return characteristics of hedge funds, Over 6,5006,500 UK UK and and international international pensions pensions funds funds and and over over 5,5004,600 4,600 keykey key transposition. show there is great growth potential at this nexus point To make the most of the UCITS IV Directive, the between alternative and traditional investment. advisers toto thesethese funds funds industry will need to continue to work on a number of important issues, in particular to make fund processing Post-Madoff/Nadel Clampdown Easy-to-use and flexible searchsearch facilitiesfacilities allowing allowing you you to to make make selections by simpler and more automated. More generally, both politics The Madoff and Nadel sagas prompted governments fundselections sizes by (in fund various sizes currencies), (in various adviser, currencies), country adviser, and industry country and and industry have to address pension issues and the future to explore new ways of clamping down on hedge fund industry* role that UCITS investment funds could play to meet the activities; with UCITS there is a structure already in place Hypertext links allowing you to skip between major funds and their challenges ahead. These challenges include: how to limit which addresses many governmental concerns. Although the risk of UCITS investments, how to ensure inflation- to some extent the hedge fund industry has been used as advisersHypertext with links many allowing hotlinks you toto skipcompany between websites major funds also availableand their neutral returns and how to adapt the UCITS tax treatment a political scapegoat and the survival bias is an argument advisers with many hotlinks to company websites also available for old-age pension provisions, in order to foster a savings that funds which came through the recent turmoil are On the fully downloadable version your search results can be output as csv files. culture. Industry and politicians will have to deal with these carrying the crosses for those that did not, there is still a On the fully downloadable version your search results can be output as challenges collectively. need for the alternative investment industry to mature as it The path to the single European market may be long and moves into the mainstream. csv files. complex but it is well under way and UCITS IV is a great With this trend in mind, it is unsurprising that swathes For* industry further searches information UK version includingonly read-only and fully downloadable milestone in its advance. of managers are exploring the possibilities of launching Dr. Wolf Klinz, Member of the European Parliament, one of their products within a UCITS structure. However, optionsFor further for information this website, including please read-only contact and a fullymember downloadable of our data sales Chairman of the Special Committee on the Financial, dangers lurk for managers and investors alike when it is options for this website, please contact a member of our data sales Economic and Social Crisis, writing in UCITS IV, The team on: +44 (0)20-7566 8255. their intention to simply replicate a strategy that may have team on: +44+44 (0)20-7566 (0)20-8349 8255. 9988. Transforming Event for European Asset Managers and served them well as an offshore structure. Distributors, a research publication from BNP Paribas If a manager decides not to launch a cell (a version APAPAP Information Information Services ServicesServices Ltd.Ltd. Tel: Tel: +44 +44+44 (0)20-7566 (0)20-7566 (0)20-8349 8255 8255 9988 Securities Services. of an offshore strategy in an onshore framework within 2nd2nd2nd Floor Floor Fax:Fax: +44 +44+44 (0)20-7608 (0)20-7608 (0)20-7324 1163 1163 2343 a UCITS platform) and instead do it themselves, this 6-146-146-14 Underwood Underwood StreetStreet Street Email: [email protected]@apinfo.co.uk can be an expensive proposal. A UCITS III fund offering Email: [email protected] London N1 7JQ, UK Web: www.apinfo.co.uk with only a small percentage (20%) which did not see the weekly liquidity with indicative daily pricing, compared with LondonLondon N1N1 7JQ,7JQ, UK UK Web:Web: www.wlrstore.com/apinfo www.apinfo.co.uk idea of outsourcing non-core functions as an option. The monthly pricing and quarterly liquidity for a typical offshore balance of 15% responded that they would be looking to fund, will incur higher administration costs alone, placing use third-party providers for non-core functions in the near upward pressure on the Total Expense Ratio.
22
ISJ47 complete text Jun02.indd 22 03/06/2010 22:59 Pension Funds Online ad:Layout 1 01/03/2010 15:24 Page 1
www.pensionfundsonline.co.uk The Online Source for UK and International Pension Funds
www.pensionfundsonline.co.uk is the online source for pension fund www.pensionfundsonline.co.uk is the online source for pension fund information created by the publishers of Pension Funds and their Advisers information created by the publishers of Pension Funds and their Advisers (AP Information Services Ltd.) and the joint publishers of International (AP Information Services) and the joint publishers of International Pension Pension Funds and their Advisers (AP Information Services Ltd. and IPE Funds and their Advisers (AP Information Services and IPE magazine). magazine). This innovative online product has been developed to compliment the This innovative online product has been developed to compliment the use of both our pensions print directories Pension Funds and their use of both our pensions print directories Pension Funds and their Advisers and International Pension Funds and their Advisers. Advisers and International Pension Funds and their Advisers.
WithWith optionsoptions ranging fromfrom read-onlyread-only to to fully fully downloadable, downloadable, www.pensionfundsonline.co.uk gives you fully up-to-date information www.pensionfundsonline.co.uk gives you fully up-to-date information on 6,500 UK and international pension funds at any time during your on 6,500 UK and international pension funds at any time during your 12-month subscription. 12-month subscription.
www.pensionfundsonline.co.ukwww.pensionfundsonline.co.uk gives you accessaccess to:to:
Over 6,5006,500 UK UK and and international international pensions pensions funds funds and and over over 5,5004,600 4,600 keykey key advisers toto thesethese funds funds
Easy-to-use and flexible searchsearch facilitiesfacilities allowing allowing you you to to make make selections by fundselections sizes by (in fund various sizes currencies), (in various adviser, currencies), country adviser, and industry country and industry* Hypertext links allowing you to skip between major funds and their advisersHypertext with links many allowing hotlinks you toto skipcompany between websites major funds also availableand their advisers with many hotlinks to company websites also available On the fully downloadable version your search results can be output as csv files. On the fully downloadable version your search results can be output as csv files. For* industry further searches information UK version includingonly read-only and fully downloadable optionsFor further for information this website, including please read-only contact and a fullymember downloadable of our data sales teamoptions on: for +44 this (0)20-7566 website, please 8255. contact a member of our data sales team on: +44+44 (0)20-7566 (0)20-8349 8255. 9988. APAPAP Information Information Services ServicesServices Ltd.Ltd. Tel: Tel: +44 +44+44 (0)20-7566 (0)20-7566 (0)20-8349 8255 8255 9988 2nd2nd2nd Floor Floor Fax:Fax: +44 +44+44 (0)20-7608 (0)20-7608 (0)20-7324 1163 1163 2343 6-146-146-14 Underwood Underwood StreetStreet Street Email:Email: [email protected] [email protected]@apinfo.co.uk LondonLondonLondon N1N1N1 7JQ, 7JQ,7JQ, UK UK Web:Web: www.wlrstore.com/apinfo www.apinfo.co.ukwww.apinfo.co.uk
ISJ47 complete text Jun02.indd 23 03/06/2010 22:59 KN2244ISJAD 203x267:Fund Forum advert 14/4/10 16:58 Page 1
Under the Microscope UCITS VI Towards A Vibrant Credible And Useful Asset Management Business
THE MYNERS INTERVIEW 2010 Investors Beware risk management. "Mobilising the With One Of Europe’s Most Influential Additionally, methods of investor protection that limit Looking ahead to UCITS IV and beyond to a putative Hedge Fund Leaders gearing, particularly within non-sophisticated funds, could UCITS V, rather than back at UCITS III, Merchant Capital industry network NEW curtail a manager s ability to match their performance director Christopher Day opines that Europe has a an to secure the in the offshore fund. Due to the very nature of UCITS III opportunity, after only 25 years of development of a and its liquidity constraints, private equity, real estate and consistent harmonised approach, to leave the US behind. trust of ISJ distressed debt are not compatible as strategies with the Advances made since the original UCITS directive in 1985 customers" Readers structure. Investors should therefore be wary of managers should not be understated. And the UCITS IV addition to Dominique Carrel-Billiard Save £100 who have had to make significant changes to their the family represents the final nail in the coffin for those CEO Quote VIP code Paul Marshall portfolio in order to ‘fit into’ UCITS. Although the directive’s European countries that like to make life more difficult. AXA INVESTMENT KN2244ISJAD Co-Founder guidelines are flexible, they are likely to continue to If you had mentioned the words hedge fund in Spain MANAGERS MARSHALL WACE encourage participation predominately by equity long/short 10 years ago you d have been thrown out of the country, and global macro funds. jokes Christopher Day. He continues in a more serious A New Dynamic Experience For An Industry In Search Of Positive Solutions Aside from the considerations of a specific strategy, it is vein. As long as politicians don t break it [UCITS IV], important the proper infrastructural support is in place to you have something that is ahead of its time globally. It is 160+ Speakers Including Over 35 Leading Asset Manager CEOs ensure that the diversification mechanisms, embodied by well ahead of the US where they are still trying to get to Special Guest NEW NEW NEW Speakers The New Fund the 5/10/40 rule*, and again this can be expensive. grips with the regulation of hedge funds. Politicians and This brings us on to what the regulators state is the most other authorities should nurture it, not kill it. Let s hope NEW Forum Proposition important component of managing a successful UCITS they ll be too worried about offshore hedge funds to worry Jamie Broderick Joachim Faber Dominique Alain Dromer John Flint Alain Grisay, F&C Nils Bolmstrand Jean-Baptiste de IX G WKH ULVN P D DJHPH W SURFHVV 5 0 3 7KH JOREDO unnecessarily about UCITS. That will give it time to settle J.P. MORGAN ALLIANZ Carrel-Billiard AVIVA HSBC ASSET INVESTMENTS SKANDIA Franssu • External Opinion Formers Challenge ASSET GLOBAL AXA INVESTORS MANAGEMENT INVESTMENT INVESCO MANAGEMENT INVESTORS INVESTMENT GROUP EUROPE The Industry: financial crisis exposed significant weaknesses in the risk down, and potentially become the regulatory framework of MANAGERS Dr. Randy Cohen management practices of many funds and investors are choice. Europe s funds could become as big as the USA s, MIT SLOAN Regulators, Consumer Advocates, NEW NEW NEW NEW NEW now demanding that funds implement stronger RMPs. delivering hitherto unimagined economies of scale, both in New Customer-Facing Businesses Merchant Capital, for its part, has employed what it terms of cost and expertise. NEW believes to be the most efficient solution by hiring a global He warns, though, of the possible repeat of the carbon • A Full Day Focus On The New Tom Rampulla Martin Gilbert Allan Polack Philippe Roderick Juan Alcaraz Rupert Clarke Alexandre Meyer professional risk and valuation services firm – Kinetic. trading scenario, when Europe threw away a similar VANGUARD ABERDEEN NORDEA Marchessaux Munsters SANTANDER HERMES FUND LOMBARD Customer: INVESTMENTS ASSET SAVINGS & BNP PARIBAS ROBECO ASSET MANAGERS ODIER FUNDS Related to this, if a fund does not have a sophisticated chance. Europe had the potential to lead the world until MANAGEMENT ASSET INVESTMENT MANAGEMENT Ensure You Stay Relevant: The MANAGEMENT PARTNERS pre-trade compliance tool and an experienced compliance governments cheated, snatching defeat from the jaws of Lawrence McDonald Practicalities Of Bringing The officer in place, there is not only an inherent risk borne victory, he concludes. LEHMAN EYEWITNESS …… Plus CIOs, Strategists & Portfolio Managers & AUTHOR Customer To The Heart Of Boardroom by the company, but also an opportunity cost due to time *a UCITS structured fund may invest no more than 10% of its net assets in transferable securities or money market instruments NEW NEW NEW NEW NEW NEW Strategy spent by the fund manager ensuring their weightings NEW issued by the same body, provided that the total value of are correct. The fund s performance will undoubtedly be transferable securities or money market instruments held in issuing • Decision Makers Exclusive affected if the manager is perpetually concerned about bodies in each of which it can invest more than 5% is less than 40%. Christian Rick Lacaille Anne Richards Raphel Kassin Euan Munro Philip Warland Borja Largo Jan Loeys Boardroom Summit With Regulators: position sizes. Far better for the investment specialist to be Dargnat STATE STREET ABERDEEN REYL ASSET STANDARD LIFE FIDELITY ALLFUNDS J.P. MORGAN BNP PARIBAS ASSET MANAGEMENT INVESTMENTS BANK A Unique First For The Industry able to concentrate their expertise where it is best applied, INVESTMENT MANAGEMENT Conclusions PARTNERS Guillaume Prache knowing that the necessary systematic support and EUROINVESTORS.ORG The UCITS IV Directive should lead to a more efficient • New CEOS Never Seen Before At personnel are in place. and competitive European Union asset management Hear Over 50 Major Fund Selectors, Distributors & Wealth Managers NEW FundForum: industry. NEW NEW NEW NEW NEW Bolmstrand, Rampulla, Broderick, Risk And Regulators The Directive will most likely result in a shift from the In addition to performance attribution, value-at-risk current situation of asset management companies being Munsters, Meyer, Polack... (VaR) analyses and stress testing, regulators want to organised in vertical silos to one where the set-up is more Alexis Calla Henriette Bergh Jean Francois Vincent Regan Richard Vincent Richard Philbin Mike Taylor Mattias Hagen CITI CONSUMER MORGAN Hautemulle DEUTSCHE SKANDIA ARCHITAS LONDON SEB WEALTH Patrick Dixon address issues such as OTC valuation, liquidity, leverage GROUP STANLEY UNICREDIT BANK PRIVATE INVESTMENT PENSION FUND MANAGEMENT • Record Number Of Fund Selectors: pan-European, centralised and horizontal. Today, an asset GLOBAL CHANGE and counterparty risk, all areas that in some cases were manager which distributes in six countries, needs to have PRIVATE BANK WEALTH GROUP AUTHORITY 50+ Speaking, 200 Attending conspicuous for being inadequately monitored recently. To six management companies, handle six funds, and use six PLUS DISTRIBUTION SUMMIT 2010 NEW do so, managers must implement an internal framework if Redrawing The Distributor/Manufacturer Relationship For A New Era – 28 June 2010 depositaries. Under UCITS IV, the same asset manager • Ten Brand New Research Pieces: they are to stand up to regulatory due diligence. It would With Barclays Wealth, AllFunds Bank, Investec, A.A.Advisors, Skandia, Morgan Stanley, Fortis and many more can choose to have only a single management company, Including Five New Research Houses be impossible for a fund to launch a UCITS fund without two funds, two feeder funds, and use four depositaries, for PRODUCT INNOVATION WORKSHOP Never Seen At FundForum these systems in place and managers must be cognisant PLUS Tomorrow's Products For Tomorrow's Clients – 2 July 2010 the same distribution coverage. Eddy Wymeersch of the costs involved. Opportunities for asset managers will differ from With Pioneer, Robeco, Fidelity, GAM, SWIP and Principal Global Investors CESR Greater transparency, improved liquidity terms and country to country, and by asset manager business Main 3 Day Conference 29 June - 1 July 2010 • PLUS OPTIONAL DAYS: NEW Distribution Summit - 28 June 2010 • NEW Product Innovation Workshop - 2 July 2010 • Grimaldi Forum, Monaco www.icbi-fundforum.com counterparty exposure controls are becoming more model and size. Options will open up across the various Sponsored By important as features of the maturing absolute return markets depending on the local culture and tax system. Co-Sponsors Lanyard fund industry. There is a growing audience that believes The trick for the asset managers is to approach each Sponsor that the UCITS directive, which lays greater importance country bearing in mind their investors needs and the on these features, can re-invigorate the investment characteristics of their own organisations. By the same Bag community s interest in these strategies. Nonetheless, token, local expertise in an asset-servicing provider will Sponsor although the UCITS liquidity, transparency and continue to be desirable as accounting rules, tax treatment diversification requirements offer much more protection and regulatory reporting will remain country-specific. Speaker & than their offshore counterparts, investors would be In order to take advantage of UCITS IV, asset managers Panellist wise to look out for warning signals from managers Zone will need a strategic approach. Those dealing with UCITS Sponsors who struggle to match the performance of their existing and non-UCITS funds also have to consider similarities offshore funds or have not fully adapted to the UCITS and differences between the AIFM and UCITS Directives. Endorsed By world. In saying that, Merchant Capital expects the This will allow regulatory arbitrage. Created and ICBI majority of managers to thrive under the UCITS umbrella Asset managers will need to decide on the types of produced by by offering institutional and retail markets the greater investors and markets to target, first within and then returns they are so keenly seeking now with appropriate ISJ outside the European Union. To Register: Call +44 (0) 20 7017 7200. Fax: +44 (0) 20 7017 7807. Email: [email protected] For the latest programme, please visit: www.icbi-fundforum.com 24
ISJ47 complete text Jun02.indd 24 03/06/2010 22:59 KN2244ISJAD 203x267:Fund Forum advert 14/4/10 16:58 Page 1
Towards A Vibrant Credible And Useful Asset Management Business
THE MYNERS INTERVIEW 2010 With One Of Europe’s Most Influential "Mobilising the Hedge Fund Leaders industry network NEW to secure the trust of ISJ customers" Readers Dominique Carrel-Billiard Save £100 CEO Quote VIP code Paul Marshall AXA INVESTMENT KN2244ISJAD Co-Founder MANAGERS MARSHALL WACE A New Dynamic Experience For An Industry In Search Of Positive Solutions
160+ Speakers Including Over 35 Leading Asset Manager CEOs Special Guest NEW NEW NEW Speakers The New Fund NEW Forum Proposition
Jamie Broderick Joachim Faber Dominique Alain Dromer John Flint Alain Grisay, F&C Nils Bolmstrand Jean-Baptiste de J.P. MORGAN ALLIANZ Carrel-Billiard AVIVA HSBC ASSET INVESTMENTS SKANDIA Franssu • External Opinion Formers Challenge ASSET GLOBAL AXA INVESTORS MANAGEMENT INVESTMENT INVESCO MANAGEMENT INVESTORS INVESTMENT GROUP EUROPE The Industry: MANAGERS Dr. Randy Cohen MIT SLOAN Regulators, Consumer Advocates, NEW NEW NEW NEW NEW New Customer-Facing Businesses NEW • A Full Day Focus On The New Tom Rampulla Martin Gilbert Allan Polack Philippe Roderick Juan Alcaraz Rupert Clarke Alexandre Meyer VANGUARD ABERDEEN NORDEA Marchessaux Munsters SANTANDER HERMES FUND LOMBARD Customer: INVESTMENTS ASSET SAVINGS & BNP PARIBAS ROBECO ASSET MANAGERS ODIER FUNDS MANAGEMENT ASSET INVESTMENT MANAGEMENT Ensure You Stay Relevant: The MANAGEMENT PARTNERS Lawrence McDonald Practicalities Of Bringing The LEHMAN EYEWITNESS …… Plus CIOs, Strategists & Portfolio Managers & AUTHOR Customer To The Heart Of Boardroom NEW NEW NEW NEW NEW NEW Strategy NEW • Decision Makers Exclusive
Christian Rick Lacaille Anne Richards Raphel Kassin Euan Munro Philip Warland Borja Largo Jan Loeys Boardroom Summit With Regulators: Dargnat STATE STREET ABERDEEN REYL ASSET STANDARD LIFE FIDELITY ALLFUNDS J.P. MORGAN BNP PARIBAS ASSET MANAGEMENT INVESTMENTS BANK A Unique First For The Industry INVESTMENT MANAGEMENT PARTNERS Guillaume Prache EUROINVESTORS.ORG Hear Over 50 Major Fund Selectors, Distributors & Wealth Managers • New CEOS Never Seen Before At NEW FundForum: NEW NEW NEW NEW NEW Bolmstrand, Rampulla, Broderick, Munsters, Meyer, Polack...
Alexis Calla Henriette Bergh Jean Francois Vincent Regan Richard Vincent Richard Philbin Mike Taylor Mattias Hagen CITI CONSUMER MORGAN Hautemulle DEUTSCHE SKANDIA ARCHITAS LONDON SEB WEALTH Patrick Dixon GROUP STANLEY UNICREDIT BANK PRIVATE INVESTMENT PENSION FUND MANAGEMENT • Record Number Of Fund Selectors: GLOBAL CHANGE PRIVATE BANK WEALTH GROUP AUTHORITY 50+ Speaking, 200 Attending
PLUS DISTRIBUTION SUMMIT 2010 NEW Redrawing The Distributor/Manufacturer Relationship For A New Era – 28 June 2010 • Ten Brand New Research Pieces: With Barclays Wealth, AllFunds Bank, Investec, A.A.Advisors, Skandia, Morgan Stanley, Fortis and many more Including Five New Research Houses PRODUCT INNOVATION WORKSHOP Never Seen At FundForum PLUS Tomorrow's Products For Tomorrow's Clients – 2 July 2010 Eddy Wymeersch With Pioneer, Robeco, Fidelity, GAM, SWIP and Principal Global Investors CESR
Main 3 Day Conference 29 June - 1 July 2010 • PLUS OPTIONAL DAYS: NEW Distribution Summit - 28 June 2010 • NEW Product Innovation Workshop - 2 July 2010 • Grimaldi Forum, Monaco www.icbi-fundforum.com
Sponsored By Co-Sponsors Lanyard Sponsor
Bag Sponsor
Speaker & Panellist Zone Sponsors
Endorsed By Created and produced by ICBI
To Register: Call +44 (0) 20 7017 7200. Fax: +44 (0) 20 7017 7807. Email: [email protected] For the latest programme, please visit: www.icbi-fundforum.com
ISJ47 complete text Jun02.indd 25 03/06/2010 22:59 The ISJ Profile Mark Mobius Templeton Investments
Mark Mobius on The Secrets of CYCLING Investment Success, SUCCESS Cycling In Chile and Bikini-Clad Beauties
Mark Mobius, Ph.D., executive chairman, joined Templeton in Mark Mobius, emerging markets investment specialist at 1987 as president of the Templeton Emerging Markets Fund, Templeton Investments for the past 23 years, is arguably Inc. He currently directs the analysts based in Templeton’s the best known name and face in the emerging markets 16 emerging markets offices and manages the emerging investment world. As has been pointed out more than once, markets portfolios. Dr. Mobius has spent more than 40 he bears a striking resemblance to the late movie star Yul years working in emerging markets all over the world. In Brynner. As has also been pointed out more than once, he that time he has been perfectly happy to share with the spends most of the year traveling from one exotic location wider world his ‘secrets of success’ frankly and openly. to another, in search of new investment opportunities and Investor Services Journal is delighted to be the vehicle this to monitor existing investments. time round.
In emerging markets investment, it is necessary to “commonsense: implies the clarity and simplification required be optimistic since the world belongs to optimists; the to integrate successfully all the complex information with pessimists are only spectators. which investors are faced.
Frankly, while there are certainly numerous technical skills Creativity one can learn to aid in making A significant amount of creativity is required for successful Both buyers and investments or managing a investing, since it is necessary to look at investments from sellers are acting on fund, investing is still a large a multifaceted approach, considering all the variables that percentage psychological. Both could negatively or positively affect an investment. Also a combination of buyers and sellers are acting creative thinking is required to look forward to the future and instinct, information on a combination of instinct, forecast the outcome of current business plans. information and logic. It is and logic. important not to forget the key Independence role that development of certain personal characteristics can contribute to your investment success. Mark Mobius Cycling In Chile
Hard work and discipline Someone asked me once if I could condense the most important qualities needed for a good investor into five words and I replied: Motivation, humility, hard work and discipline. If you think you It stands to reason that the more time and effort is put know all the answers into researching investments, you probably don’t the more knowledge will be gained and wiser decisions will even know the be made. Humility is needed questions. so you are able and willing to ask questions. If you think you know all the answers you probably don t even know the questions.
Commonsense I think to think that commonsense is most important when making investment decisions, since the word 26
ISJ47 complete text Jun02.indd 26 03/06/2010 23:00 A number of successful investors have commented on the at the long-term growth and prospects of companies and importance of independence and individual decision-making. countries, particularly those stocks, which are out of, favor If one buys the same securities as other people, one ends up or unpopular, the chances of obtaining a superior return are with the same results as others. It is impossible to produce much greater. To minimize discomfort or disappointment, a superior performance unless one does something different investment averaging should be undertaken. from the majority. Investment averaging Risk-taking Another point that should be remembered by investors Investment decisions always require decisions based on is the importance of investment averaging by purchasing insufficient information. There is never enough time to learn consistently in a measured and periodic pattern. Investors all there is to know about an investment and even if there who establish a program from the very beginning to were, equity investments are undergoing continuous change purchases shares over a set period of time have the making it impossible to obtain the most updated information. opportunity to purchase at not only high prices, but also low There always comes a time when a decision must be taken prices, bringing their average cost down. and a risk acquired. The ability to take that risk based on the best diligently gathered available information is the mark of a Accepting market cycles good investor. Any study of stock markets around the world will show that bear or bull markets have always been temporary. It is Flexibility clear that markets do have cyclical behavior wit pessimistic, It is important for investors to be flexible and not permanently adopt a particular type of asset. The best approach is Mobius Rules: The Bust Box to mitigate from the popular to the unpopular securities or sectors. It s also an attribute, which keeps one from • When you tap into an attitude in any country that holding on to a stock out of loyalty – flexibility allows one to says ‘we’re number one, we’re the best, no-one can change as times change and new circumstances present beat us’…that’s the right time and the right country themselves. to SELL. • When everyone else is dying to get in, get out. Well these are the key personal qualities that affect investment-making decisions, the following are important • When everyone else is screaming to get out, get in. investment attributes that will benefit your investments. • If a broker starts giving you the hard sell, never buy.
Diversification • The best time to buy is when everyone else is It is actually possible to have all your eggs in the wrong screaming that there’s blood on the streets. basket at the wrong time, especially in emerging market • In times of crisis, people on the ground start coming investment. To reduce one s vulnerability to this eventuality, to their senses. every investor should diversify. This is particularly important in emerging markets where individual country or company • Easy times make people go soft. Hard times get risks can be extreme. Even given the risks, however, global people going. investing is always superior to investing in only your home • What goes down usually goes back up, if you’re market or in one market. If you search worldwide, you will willing to be patient, and don’t hit the panic button. find more bargains and better bargains than by studying one nation. • The problem with recoveries is that they don’t make good copy. Timing and staying invested • Market meltdowns make headlines. Market I love to reply to those who ask when they should invest in recoveries make money. equities by using the provocative answer provided by Sir John Templeton: The best time to invest is when you have • A liquid stock market is one that’s easy to get out of, money. The reality is that market timing is impossible, and not just easy to get in. since equity investing is the best way to preserve value, Source: Passport To Profits. rather than leaving money in a bank account, it is best to just get going, rather than wait for the fabled perfect moment. A skeptical, optimistic, euphoric, panic and depressive phases. corollary to the question of when to buy is, of course, when Investors should thus expect such variations and plan to sell. My feeling on that issue is that investments should accordingly. We have all adopted the belief that the time of not be sold unless a much better investment has been found maximum pessimism is the best time to buy and conversely to replace it. the best time to sell is the moment of maximum optimism. As often noted, if it s possible to see the light at the end of the Long-term view tunnel, then it is probably already too late to buy. I know how unsatisfying it is for investors who invested in a fund or a stock only to see the net asset value or price do And Is There Still Time For Play? down, or not make the fast gains they were expecting, to All work and no play would make Mark a dull boy, though, hear that they should be in it for the long-term. But it s the and he is certainly not dull. A keen cyclist, he takes truth. As investment managers, we have a policy of looking advantage of every chance to climb into the saddle and see to the long-term because experience has shown us that if more of the world than just airports, factories and balance we try to make short-term gains the result will work against sheets. He has many a tale to tell that might make lesser outstanding performance. Since most investors look at the mortals go green with envy. short term, then we certainly should not do that. By looking Every time we come to Vina del Mar, a two-hour drive from 27
ISJ47 complete text Jun02.indd 27 03/06/2010 23:00 The ISJ Profile Mark Mobius Templeton Investments
Santiago airport in Chile, and one of my favourite places in Chile s leading export became, and still is, copper. the world, we take our folding bicycles for a short cycle to the art deco casino and the town where there is good shopping Bikini-clad Beauties Peruvians and and restaurants. This time we There were all kinds of events on this particular visit, he extended our cycling for two relates, including a local pisco promotion featuring bikini- Chileans each claim hours past the Army Academy clad beauties cavorting on a temporary stage. Pisco is the to have the best with its collection of antique local clear brandy, he explains. It s great when made into cannons and then further on a picso sour, a delicious mixture of lemon juice, egg white pisco but after one to the delightful beaches with (creating the tempting white foam at the top of the glass), pisco sour, who stylish beachfront cafes. sugar and, of course, the powerful pisco. Peruvians and cares!” Chileans each claim to have the best pisco but after one In and around Vina del Mar, pisco sour, who cares! Oddly enough, some might feel there are many houses and even a seaside castle built unfortunately, there s no further elaboration on the subject of by entrepreneurs who got rich from exploiting saltpeter bikini-clad beauties resources in northern Chile, an observation he makes that underlines how embedded is business in his DNA. He In the evening we took the new Metro fast train to the heart recalls that the boom began when in 1840, a French scientist of old Valpariso and found a quaint restaurant, Porto Viejo discovered that sodium nitrate for use as fertilizers and which served delicious fish. Since the restaurant is mainly for explosives could be derived from both guano and caliche locals, the waiter didn t speak English but we were rescued Desert bordering Chile, Bolivia and Peru. Chile fought and by the owner s American educated cool gangly young son won the 1879 to 1883 War of the Pacific over those mineral with a cute girlfriend. The food was great but so were the deposits against Bolivia and Peru and acquired control of quantities and we staggered out. After dinner we decided those countries border provinces. One result which still to take a little walk to the funicular railway going to the top rankles the Bolivians was that Bolivia lost its Pacific port of the mountain overlooking the city very much like Hong province and thus became landlocked with no access to Kong s Peak Tram. Walking up the cobblestone streets the sea. For a long time those nitrates were Chile s largest and alleyways we encountered architectural and cultural export and attracted Europeans and others eager to get rich sites at almost every corner. No wonder the city has been on the valuable mineral. However when synthetic nitrates named a UNESO World Heritage Site. Climbing up a high were developed in the beginning of the twentieth century stairway leading to the funicular rail station we found that it The following is an edited against regulation are very strong in Washington. There’s $600 trillion of derivatives outstanding; lots of money is reproduction of an interview on 25 being made with derivatives. It’s not going to go away; I April 2010 with CNBC Asia don’t think that regulators will kill that golden goose.
CNBC ASIA: The shadow on Wall Street, of course, is this CNBC ASIA: I’ve heard that if you take a very extremist finance-related bill. The senate will vote on whether or not view of things, or maybe even not that extremist a view, to subject the biggest financials to more scrutiny and give that the cowboy days – the wild wild west days in the regulators more powers to seize controls of firms going financial industry are looming, and that they are going to belly-up or hoping to avoid another global financial crisis. become like utilities – water companies, electric companies, Dr Mark Mobius, executive chairman of Templeton Asset gas companies - is that what could possibly happen in the Management says that it is about time. financial industry? How would that affect your view, of whether or not you want to engage in this space? MOBIUS: The question now is why it wasn’t done previously. If you remember, Mrs. Bourne, who is the MOBIUS: Well, I mean, my feeling is that if stock exchanges, head of the futures commission warned everyone about savings banks, and those institutions became utilities, I’m all derivatives and wanted to regulate them. But, Greenspan, for it because that’s the service that has to happen properly Rogan, Larry Summers were against it – they didn’t want and regulated for the market to work. But I don’t think the regulation to take place so it could have happened volatility will go away; I don’t think turnover will go away; I but it didn’t. The SEC has lots of powers to regulate but don’t think trading will go away. This will continue because they didn’t, so the proof would be in what happens at the everybody realises, including the administration, that this is regulatory administrative level to implement what is passed essential for the workings of a free economy. in congress. But I think generally speaking, what we have to look at CNBC ASIA: Let’s bring it back to this neck of the woods, is the incentives. Where are the incentives? In the case of finally. Could this be the beginning of a break out, for financial derivatives, I personally think there should be a emerging market financials? Asian banks, for example. I small tax, a small fee, put on financial derivatives, maybe 10 mean, if Wall Street is going to go through another raising, basis points, so that you’ll have exposure – if you have a tax, another round of this, what could happen to like the major then you’re going to have exposure. You must have liquidity, Chinese banks –could there be heightened interest? you must have a transparency. We need to put those kinds of reforms in place. MOBIUS: There already is. I mean a lot of money has been CNBC ASIA: What is the risk that they are going to over- pouring into emerging market funds, particularly in Asia. Half regulate? of all money going into emerging market funds is in Asia so there’s heightened interest because if you look at the MOBIUS: I don’t think that’s going to happen. The forces credit default swaps, spreads for Greece and Portugal are
28
ISJ47 complete text Jun02.indd 28 03/06/2010 23:00 higher than China, far higher, so people are more confident time, it’s going to be gradual, a reform of the market, is that in putting money into these banks. The danger is that the the Chaebols are reforming. There’s a growing realisation lessons we’re learning now in the west are not learnt that they cannot continue to have this so-called Korean in Asia. Hopefully, they’ll adopt some of the regulatory discount. Korean companies have generally been cheaper mechanisms that are now being learnt. than other markets on a price-earnings basis. And the reason, in my view, for that is the Chaebol obstruction CNBC ASIA: Despite the fear on the streets of Thailand’s of the market, and the fact that they don’t pay dividends capital, you still see plenty of value in the country? as well as other parts of the world. Because what they’re doing, in a Confucian way, is looking at not this generation, MOBIUS: Thailand has to change; it has to be an but two or three generations down the road. So they are accommodation between the mass of people in the rural continuing to invest. areas and people in Bangkok in control…the elite. That kind Honours, Books and Awards of change does not come easy. It often means violence, as Dr. Mobius earned bachelor’s and master’s degrees from we’ve seen; it takes time, but when it comes – and I believe Boston University, and a Ph.D. in economics and political it will come - you’re going to see a much changed and science from the Massachusetts Institute of Technology. improved Thailand. He is the author of the books “Trading with China,” “The Investor’s Guide to Emerging Markets,” “Mobius on CNBC ASIA: You are accumulating, right now? Emerging Markets,” “Passport to Profits,” “Equities - An Introduction to the Core Concepts,” “Mutual Funds - An MOBIUS: Yes Introduction to the Core Concepts” and “Mark Mobius - An Illustrated Biography.” CNBC ASIA: In the midst of all this violence Dr. Mobius has received numerous awards. He was named by Asiamoney magazine in 2006 as one of “Top MOBIUS: In the midst of the violence, if prices come down 100 Most Powerful and Influential People.” Asiamoney enough. We are frankly surprised that prices have not come said: “Boasts one of the highest profiles of any investor down more. We, of course, would like to see prices correct in the region and is regarded by many in the financial more substantially. But we would be buyers. industry as one of the most successful emerging markets investors over the last 20 years. Despite tough times CNBC ASIA: You buy the market? during the financial crisis that erupted in the late 1990s, Or you have to be careful, going bottom? he still commands a strong following in the investment world and is influencing the direction of billions of MOBIUS: Of course, we think bottom up; we look at investment dollars.” stock picks and of course as you know, our big areas are Other awards include: (1) “Emerging Markets Equity commodities which mean the oil companies, anything Manager of the Year 2001” by International Money related to consumers – whether it be housing or retailing Marketing, (2) “Ten Top Money Managers of the 20th and so forth. Century” in a survey by the Carson Group in 1999, (3) “Number One Global Emerging Market Fund” in the 1998 Reuters Survey, (4) “1994 First in Business Money CNBC ASIA: What specifically do you do to leverage the concept of higher rate of participation in the growth of the Manager of the Year” by CNBC, (5) “Closed-End Fund economy? Manager of the Year” in 1993 by Morningstar and (6) “Investment Trust Manager of the Year 1992” by Sunday Telegraph. He was appointed joint chairman of the Global MOBIUS: Well, the way we leverage is by getting exposure Corporate Governance Forum Investor Responsibility to consumers, directly or indirectly. For example, it’s not Taskforce of the World Bank and OECD (Organisation only that we think that oil prices will continue at a higher for Economic Co-operation and Development). level, it’s also because these companies have exposure to consumers; consumer have to travel, have to move, have to have more cars and therefore we want to get exposure CNBC ASIA: There is a lot of locked up value. that way. We want exposure to the banks because they are becoming more consumer banks. The consumer banking MOBIUS: A lot of locked up value. Vietnam is a revolution has hit Thailand and that would become more frontier market for us. And the big frontier markets in and more important. our portfolio, frontier portfolios, are Vietnam, Ukraine, Kazakhstan and Nigeria. Vietnam is very, very cheap. CNBC ASIA: You recently spent some time in Korea, However, the way the market is run is a mess, because and you’ve elevated your view, your optimism over Korea, what happens is that we as final investors have to inform especially in the manufacturing space, and you’re also very everyone what we’re going to buy and when we’re going bullish on Vietnam as well, in terms of thrift and value. Can to buy it and how much we’re going to buy in advance. you address those two markets for me? In addition, we must use only one broker. So you can understand what happens – a tremendous amount of MOBIUS: In the case of Korea, we’re seeing another front running takes place. In addition, of course, that transformation taking place. Besides the fact that the would not be so bad if the liquidity was there, but their country’s really growing at something like 5%...so you’ve liquidity is very poor. So we must nibble, we must use seen a real recovery in the economic development of the tactics to get into the market slowly and gradually, but the country. But what you’re also seeing – and it’s taking a long valuations are definitely there. With Kind Permission
29
ISJ47 complete text Jun02.indd 29 03/06/2010 23:00 Regulation OTC Derivatives, Market Risk in EU
OTC Derivatives effective implementation of CCPs and trade repositories for OTC derivatives, enhanced standardisation of the Enhancements Needed legal and economic terms of OTC derivatives contracts, portfolio compression and reconciliation, the resolution of The soundness, resilience and settlement transparency of OTC derivatives and restructuring issues related to credit events, and operational improvements in the fi eld of electronic trading markets should be enhanced. In and trade matching/confi rmation. ready for your future needs particular, the establishment of sound • Report on the Lessons Learned from the Financial Crises with Regard to the Fuctioning of European Financial infrastructures for OTC derivatives Market Infrastructures. European Central Bank April 2010. should be promoted. EU Bank’s Market Risk This is just one of a number of lessons that have been learnt from the fi nancial crisis according to a just-published Now Hear This! Moody’s Says Impact report from the European Central Bank•. The fi nancial of New Market Risk Regulation on crisis encouraged securities regulators and overseers to consider adopting consistent regulatory and oversight European Banks Manageable measures to promote safety, resilience and transparency Moody s Investors Service has provided a preliminary of OTC derivatives markets and to support private sector assessment of the impact on selected European banks of initiatives in this fi eld, observes the ECB report. In line with the changes to Basel regulations for market risk due to be the respective G20 mandate, regulatory initiatives regarding implemented by the end of 2010. In a Special Comment OTC derivatives markets are currently under consideration published on April 15, the agency says that it expects the across jurisdictions. One area of focus is the establishment short-term impact of the changes to be ratings-neutral, but of market infrastructures for the trading, clearing and longer term challenges remain. Moody s says its estimates settlement of OTC derivatives, as the fi nancial crisis show that the impact of the regulatory changes on banks highlighted severe shortcomings in the bilateral organisation capital ratios will be material in some cases. of these processes. For banks with sizeable investment banking activities, Moody s expects that the implementation of the market risk ECB Recommends Follow-up Action amendments will lower capital ratios by up to 17%. However, • Establishment of a sound infrastructure for OTC this appears to be manageable in most cases, given the derivatives. increase in capital and the deleveraging that took place An immediate priority identifi ed by the ECB is to during 2009, says Alessandra Mongiardino, a London- progress towards enhanced use of CCPs for OTC based Vice President, Senior Credit Offi cer and the main derivatives eligible for central clearing. In addition, author of the report. Second-tier banks with sizeable market measures are being considered to strengthen risk risk activities may also be affected by these regulatory management for contracts not eligible for central clearing, changes. Second-tier players could be under pressure as well as to promote reporting of OTC derivatives and may review their continued presence in certain market- The state-of-the-art IT solution for: contracts to trade repositories (TRs). In the EU, the related activities, and may decide to concentrate on their European Commission issued a Communication on future core activities, a development that might be credit-positive, actions to improve the resilience of OTC derivatives she adds. · Securities Lending markets in October 2009. Legislative proposals are The report also notes that, in the longer term, there expected to be delivered by mid-2010. are other elements that need to be taken into account As part of the legislative package envisaged, the when looking at banks creditworthiness in light of the Commission intends to develop comprehensive EU legal new regulatory environment, in particular as they relate · Repo frameworks for CCPs and trade repositories to ensure to the so-called Basel III proposals. Moody s believes the safe and effi cient functioning of these infrastructures that a more accurate refl ection of the risks inherent in and to limit the potential for possible regulatory arbitrage these activities, with capital levels better aligned with the · Synthetic Finance across jurisdictions. Such legislation is expected to build risks, is a credit-positive given that it improves banks on the recently fi nalised ESCB-CESR Recommendations resilience to economic shocks. However, banks will be for CCPs in the EU, which consider the specifi c risks under pressure to fi nd ways of enhancing profi tability to meet · OTC Derivatives Collateral Management inherent in the clearing of OTC derivatives. Regulatory shareholders ROE expectations, says Mongiardino. They reform along similar lines is being considered in the United may therefore increase their risk profi le again in order States, where possible measures were outlined in May to achieve these objectives. The way that banks will 2009. handle these opposing requirements will likely affect their Given the global nature of OTC derivatives markets, creditworthiness. Finace is currently the only fully integrated solution which supports the future business models within the global convergence of the regulatory measures adopted A fi nal element to consider is that each country must area of Securities Finance and Collateral Management. The architecture of Finace is based on a stable, in the various jurisdictions will be essential. This work is translate the Basel Committee s recommendations into leading edge technology platform which was developed with performance and robustness as the focus of supported by the review of the CPSS and IOSCO of the amendments to the local market risk framework. This design. With flexibility at its core, customer-driven extensions and modifications can be quickly and easily application of the 2004 CPSSIOSCO recommendations for leaves open the risk that the amendments might not CCPs to clearing be applied consistently across banks headquartered in applied to the standard component set. arrangements for OTC derivatives, launched in June 2009. different jurisdictions. Given the highly globalised nature of With the impetus and support of regulators, several capital markets, any regulatory arbitrage will have negative COMIT AG, Pflanzschulstrasse 7, CH–8004 Zürich, Phone +41 (0)44 298 92 00 private sector initiatives to enhance the functioning of OTC consequences for the stability of the fi nancial market and for [email protected], www.finacesolution.com derivatives markets are also underway. These involve the bond investors, says the report.
30
ISJ47 complete text Jun02.indd 30 03/06/2010 23:00 ready for your future needs
The state-of-the-art IT solution for: · Securities Lending · Repo · Synthetic Finance · OTC Derivatives Collateral Management
Finace is currently the only fully integrated solution which supports the future business models within the area of Securities Finance and Collateral Management. The architecture of Finace is based on a stable, leading edge technology platform which was developed with performance and robustness as the focus of design. With flexibility at its core, customer-driven extensions and modifications can be quickly and easily applied to the standard component set.
COMIT AG, Pflanzschulstrasse 7, CH–8004 Zürich, Phone +41 (0)44 298 92 00 [email protected], www.finacesolution.com
31
ISJ47 complete text Jun02.indd 31 03/06/2010 23:00 Technology Releases Thomson Reuters Elektron / BNY Melllon Dashboard
Data: The Next Generation financial applications into the Elektron hosting centres have experienced significant cost reduction and superior If latency is reduced much further, performance. we’ll be travelling back in time. Using this open and neutral network, clients, exchanges, brokers and other liquidity providers will be able to publish If latency is reduced much further, we ll be travelling back in messages and content directly to their discrete counterparties time. That is one flippant reaction to the latest news from the and subscribe to service providers analytics, algorithms, risk frontline of the acceleration and automation of trading, with models, as well as post trade facilities and reference data the announcement from Thomson Reuters that it is seeking resources. to transform financial markets with the launch of Elektron, Thomson Reuters says that Elektron builds on this by which it describes as a unique global fabric delivering being fully compatible with its existing middleware, metadata supreme performance, unrivalled access and connectivity to and commercial model. Third parties can move all the power trade automation. applications they have built on Thomson Reuters market data We ll give Thomson Reuters time and space to elaborate system seamlessly to Elektron. on their own terms in a moment or two. But it is important to Jon Robson, President, Enterprise, Thomson Reuters place its ambitions firmly in the context of developments over adds: This is a time of extraordinary innovation for the past two to three years arising from the implementation Thomson Reuters, our customers and our partners, as of the EU s MiFID directive, which has spurred the creation together we respond to and shape a rapidly evolving of alternative trading venues such as Chi-X, Turquoise financial marketplace. Elektron is designed to enable and BATS Europe, to name but a few. The proliferation of this innovation. It marks a step-change in empowering these venues, and the increasing use the industry makes of customers, enabling them to innovate and connect to the dark pools of liquidity, has increased complexity, increased markets and to each other across a neutral, global and fragmentation of liquidity, raised important questions about content rich infrastructure. We are responding to the needs of transparency of trading strategies and correctness of pricing, a new era in the financial industry, one which requires that all and changed the very nature of demand. participants benefit from increased transparency and equal In that time, electronic trading has stopped being the access to markets. Firms of all sizes will be able to connect preserve of an elite few with the necessary black boxes. via Elektron, benefiting from greater speed, lower operating Today it is almost mainstream, within the reach of Everyman. costs and flexibility that will enable the markets to work and Algorithmic trading is much more widespread today, as evolve freely. ISJ we have adapted to the demands for automation and high performance, Mike Powell, Head of Global Enterprise Dash It All: BNYM’s New Functionality Information at Thomson Reuters, told ISJ. More and more people want to indulge in high-frequency trading, not only BNY Mellon Asset Servicing reports that it has introduced new in North America and Europe, but elsewhere. Look at the dashboard-style reporting functionality to help asset owners creation of Chi-X Australia, SBI Japan Next and Chi East, a and asset managers gain greater visibility into their securities tie up between Chi-X and the Singapore Stock Exchange. lending portfolio. The new reports, it says, provide both detailed Elektron takes away a lot of the complexity and cost of and executive summary-level information on earnings, loan connecting to multiple markets. It levels the playing field values, credit quality and other account activity designed to help and opens it up to more hedge funds and smaller players. A decision-makers evaluate performance and potential exposures single connection to our cloud gets you access to low latency, across their securities lending positions. and the full depth of a market, whether locally or regionally. Available to clients through BNY Mellon s Workbench reporting In its own words, Thomson Reuters reports that platform, the new lending dashboard offers web-based access to Elektron is a global, ultra-high speed network and hosting comprehensive and customisable data, including: environment that enables financial firms to access and Month-to-Date Lending Revenue Analysis SURYLGHV P R WKO share information faster and more cost effectively. Hedge earnings by security, including average market value available, funds, asset managers, banks, brokerages, exchanges and market value on loan, utilisation percentage, total and client other participants will for the first time be able to connect to spreads,and client earnings; the world’s largest financial community and securely reach Executive Reinvestment Portfolio Summary - details fund trading partners over the network. characteristics, floating rate index information, credit quality, Thomson Reuters Elektron enables firms to trade faster, asset class distribution, maturity schedule, top 10 issuers, daily using the most complete coverage of real time financial rating changes, and exposure by industry; information available, connect to more markets and interact Executive Lending Summary GHVLJ HG IRU H[HFXWLYH freely across a global, resilient and secure cloud. Firms of management and presented in graphical format, shows lending all sizes will benefit from significantly lower operational costs utilisation by security and top five borrowers by security type. and drastically reduced time to market, plus the opportunity It also provides daily average returns, volumes and collateral for the open exchange of data, transactions and new percentages by loan type; earnings by asset class; cash versus business opportunities. non-cash collateral held by loan type; and top 10 earnings by The launch of Elektron marks a performance step- security. change for financial information networks, argues Thomson Asset holders are clearly devoting more attention to risk and Reuters. Benchmark testing indicates that Elektron delivers demanding greater transparency in their reinvestment accounts, information up to 20 times faster than traditional aggregated said Kathy Rulong, global head of securities lending for BNY data networks. The fabric includes strategically located Mellon. Our lending dashboard offers them a wide range of proximity and co-location hosting centres, initially in New actionable data and key metrics with just a few clicks. The new York, Chicago, London, Frankfurt, Tokyo and Singapore. reporting format provides clients with at-a-glance insight into their lending portfolio, supporting the decision-making they do daily to Later this year additional centres will open in Hong Kong, ISJ India and Brazil. Clients that have already moved their manage and maximise their plan s objectives. 32
ISJ47 complete text Jun02.indd 32 03/06/2010 23:00 Analyse This Automation
THISHow can data management systems produce the right translations for the middle office? HasAnAlyse Automation Become Stuart Plane, Director, Cadis Automatic? Judging by the recent flurry of local-language releases, The mutual fund industry appears to be embracing data management providers have stepped up translation automation. Dan Llewellyn, Director of Market to try and support the global ambitions of banks and asset Innovation at Calastone, reflects on some of the key managers. But many firms are still left wanting. These industry developments and drivers and looks ahead to what enhancements provide basic data translations, but nothing the industry can anticipate. deep enough for the specific requirements of middle offices. Local-language capabilities that are built into data Over the past three years, the mutual fund industry management software from the ground up are the answer seems to have woken up to the potential of automation to getting the level and flexibility of translation needed. The processing. This may have been driven by evidence of good news is they do exist. successful post-MiFID equities markets initiatives. It The weaknesses of basic translation capabilities are may have resulted from an awareness of the limitations exposed by double-byte languages in Asia. Data of having a single incumbent transaction processing management systems which offer generic Kanji or Chinese provider. We believe it is certainly driven by regulatory translations will provide one character when, in reality, awareness. Not only in the form of RDR, but from a multiple variations are needed by the different desks, asset desire for cross-border transaction harmonisation in the classes and offices. In addition, middle offices can’t rely form of UCITS. Setting a common goal for ISO20022 has on poorly translated data to produce suitable client and helped. Many firms are figuring out how they can become regulatory reports. Where a Western-educated risk officer ISO20022-compliant yet in reality they can become can bridge the gap caused by a mistranslated character, a compliant today without needing any investment in new rural investor probably can t. processes or technology. A data management system which has had double-byte The regulators attention on risk reduction is no passing or other language support simply added on will need to fad. They, like the industry associations, are keen to find be customised to account for local variations; even then, ways to make processes more efficient, ways designed translations still may not be detailed enough. In cases to help the entire market - whatever their size, location or where the technology is legacy, IT databases would have communication preference. to be completely restructured. At a minimum this extra work The settlement model has been addressed. Historically will include manual workarounds to format data, increasing mutual fund settlement has been conducted on a the risk of mistranslation and operational error. secondary market model. Now the industry can transact So, the answer? A data management system that has R D SULPDU P DUNHW P RGHO R H ZKLFK KHOSV SDUWLFLSD WV language support built into it from the ground up. This is transact more efficiently and with greater certainty. already optimised to deliver user-specific translations. Business processes are being reviewed and amended. In When translation capabilities are built into the technology, the automation of historically manually-handled processes, data management systems are able to support the manual processes should not simply be mirrored using languages inherent in the user s underlying databases. technology. Sometimes they need to be re-thought, Translations are no longer limited to the word/character such as the automation of reconciliations. In line with scope of the data management solution; instead the user EFAMA recommendations for greater automation and fund dictates the depth of the language support. processing efficiency, and the IMA’s proposed principle for Building local-language capabilities from the ground up automation of reconciliation reporting, processes have now provides added benefits, like operational efficiency. Offices been fully automated to meet previously resource-intensive from around the world can rapidly source golden copies for regulatory requirements. local operations while working from the same data master. So what’s next? We believe the most significant Minimal manual intervention is needed to take data from a developments focus on benefiting from international master set in English and input it into the format a user in transaction processing interoperability, truly cross-border Hong Kong or Italy wants. Any middle office user can easily trading and more efficient post-trade services. So often, get data - with the terms and labels they want - across the we are asked how quickly other domestic and international life of a transaction. fund providers, distributors and transfer agents can be No firm with global aspirations should expect their middle connected so that participants can extend their reach. offices to put up with poor translations or a language they’re Firms will quickly reap the benefits of order processing and not used to. Where basic translations fail, the ground-up settlement scale, ensuring that they - and the regulators - approach to local-language support makes data work for can be confident that more flow does not mean more risk. the user and delivers real benefit to the business. 33
ISJ47 complete text Jun02.indd 33 03/06/2010 23:00 Fund Focus on Cyprus - sponsored section
of current tax laws and regulations stemming from Cyprus’ KPMG in Cyprus accession to the European Union. Preparation and annual review of tax returns partner in business In the course of KPMG’s tax advisory services, the tax Cyprus as a financial centre department undertakes the preparation and submission of Cyprus is an attractive financial centre combining the corporate and personal tax returns, Special Contribution for advantages of a traditional offshore centre with those of a full the Defence calculations, Capital Gains computations, VAT member of the European Union. returns, PAYE matters, as well as Immovable Property issues. Despite the global economic slowdown, by May 2009 more Due Diligence that 6,000 new companies had been registered. Cyprus has an Through due diligence services, KPMG provides reports excellent infrastructure allowing clients to add real substance that address the detection and correction of issues that are to their tax planning in the form of fully-fledged operations in inconsistent with the tax legislation. KPMG provides alternative the island. solutions to the business’s management and advice on the With a population of approximately one million, Cyprus is possible tax implications that may arise from each course of much larger than the other financial centres of Bermuda, the action. Caribbean, the Channel Islands, the Isle of Man, Malta or Tax and Social Insurance withholding from Salaried Income Luxembourg and has a large number of talented professionals KPMG provides services to companies and individuals in available to work in the financial services industry. Yet it is still relation to the tax management of expenses and income, possible to contact directly the government and legislators the correct withholding and remittance of PAYE and social in the jurisdiction, without having to deal with the layers of insurance contributions as well as the structuring of the most bureaucracy that tend to exist in more mature and more tax beneficial retirement plan. complex financial centres. Tax services to staff seconded to Cyprus KPMG provides the following services and the relevant support KPMG’s profile to the company as well as to the seconded individuals: KPMG is a global network of professional firms providing Audit, • Support in the settlement of foreign citizens in Cyprus, Tax and Advisory services. We operate in 144 countries and including issues relating to the Social Insurance Legislation, have 137,000 people working in member firms around the • Support for the settlement of Cypriot citizens in a foreign world. The independent member firms of the KPMG network country, are affiliated with KPMG International, a Swiss cooperative. • Provision of tax advice at the arrival of employees as well Each KPMG firm is a legally distinct and separate entity and as at their departure from Cyprus, describes itself as such. • Preparation and submission of tax returns, KPMG in Cyprus traces its origins back in 1948 and today, • Advice on tax planning opportunities and the provision of it is one of the largest and most reputable audit and advisory written tax opinions, and firms in the Cyprus market. • Provision of tax advisory services regarding income tax KPMG classifies the services offered into three functions, and capital gains tax issues of private pension tax and life each of which includes a wide range of specialized services insurances. aiming at providing our clients with the service that best suits • Tax Advisory Services their individual needs. These three functions are: • International corporate taxation • Audit • KPMG provides the following tax advisory services: • Tax • Thorough examination of the tax consequences in relation • Advisory to inbound and outbound investments, For each of these core functions, KPMG has specialized • Tax planning regarding the implementation of efficient tax departments with highly skilled professionals, headed by structures through Cyprus, partners with extensive experience. • Tax planning regarding exit strategies and efficient repatriation of profits, KPMG’s Tax and Corporate Services • Analysis of the tax implications analysis resulting One of KPMG’s fastest growing departments is the one focusing from intra-group cross-border capital movement as on tax, both local and international. The tax department of well as from the cross-border charge and/ or fees KPMG in Cyprus provides full tax support and compliance collection, tax rights and dividends under the angle services, as well as tax planning and advisory services to a of bilateral conventions and the European Tax Law. significant number of local and multinational companies. KPMG’s tax department comprises a team of proficient tax Transfer Pricing advisors who are highly experienced in the field of local and KPMG, with many years of experience on complex international international tax as well as accounting issues. and cross border transactions can provide the following Among the core functions of KPMG’s tax advisory department, services: is the provision of specialized tax opinions in: • Planning the implementation of transactions between • Corporate Taxation; related companies, • International Executive Services (I.E.S) and Personal • Compliance with Transfer Pricing principles and Income Tax; preparation of the relevant documentation. • Value Added Tax (VAT); • Review of agreements and other relevant documentation • Capital Gains Tax (CGT); for ensuring compliance with Transfer Pricing principles. • Stamp Duty Tax. Corporate Services Tax Compliance services In line with KPMG’s long-standing market reputation for Corporate Taxation providing integrated and flexible business methodologies, the Corporate tax compliance services relate to the interpretation Corporate Advisory Services practice is involved in a broad 34
1-47 main text Final ISJ47.indd 34 04/06/2010 18:33 Fund Focus on Cyprus - sponsored section
range of corporate and commercial work for a wide variety into Central/Eastern Europe and Russia was routed through of clients, both domestic and international. The advice and Cyprus because of the very advantageous tax treaty network. services we offer in the commercial arena are client-driven and are often provided in conjunction with other KPMG services. Cyprus also offers excellent infrastructure facilities and services, such as banking, telecommunications and human KPMG’s Corporate Advisory Services include: capital. Professional services are of a very high standard in • Corporate and Commercial Cyprus, with a considerable English influence. Many Cypriot • Company Secretarial Practice lawyers are members of the United Kingdom Inns of Court • Banking and Financial or graduates of British universities and are well-versed in the • Capital Markets developments of international commercial law. • EU, Competition Law and Regulatory • Private Client services The standards of the accountancy profession are equally high • Intellectual Property since the majority of its members are qualified Chartered or • Real estate Certified Accountants of the UK or Certified Public Accountants • Employment Law of the USA and International Accounting Standards and International Standards on Auditing are strictly adhered to. Present tax environment in Cyprus The international attractiveness of the Cyprus tax regime The excellent present tax environment in Cyprus is best The main features that determine the attractiveness of Cyprus illustrated by the results of a KPMG survey of European tax for international clients seeking optimization of their tax jurisdictions. structures are: Cyprus, Ireland, and Switzerland are the top three countries • lowest corporate tax rate in the EU – 10% in a league table of European tax systems, compiled by KPMG • no withholding taxes levied on outgoing overseas International, in which major business organizations across payments Europe assessed the attractiveness of their domestic tax • infinite profit parking and carrying forward of losses regimes. • minimal exemption requirements on dividends received All three countries were rated highly for their combination of from overseas subsidiaries or permanent establishments consistency in interpreting tax legislation, stability in resisting • no taxation of profits from disposal of securities frequent changes to tax laws, and comparatively low tax rate. • extensive Double Tax Treaty network These views were compiled from more than 400 interviews • OECD “white list” status of tax professionals in multinational companies across Europe. • access to all EC directives aimed at reduction of intra-EU Survey participants were asked how attractive they believed taxation their country’s tax regime was compared with other European • an advanced tax ruling system states. The survey explored participants’ attitudes to particular Cyprus attractiveness to institutional and private equity clients aspects of their home tax regime, including consistency, stability Cyprus is becoming a destination of choice for fund managers over time, volume of legislation, the tax rate and relations with seeking new locations to conduct their business. Its credibility tax authorities. as a reliable specialist center for funds is growing steadily. Taking the percentage of respondents who thought key Characteristically, an important advantage of Cyprus’ fund aspects of their domestic systems were attractive and management service is that it is relatively flexible and quick subtracting those who felt they were unattractive gives a net to set up a fund once you have all the necessary information attractiveness score for each country. and documentation in place. It is also easy for an existing Cyprus came out on top, with 90% of the participants giving fund management firm or financial services entity to obtain positive responses, leaving behind established rival holding authorization to operate in Cyprus on the basis of “passporting” jurisdictions, such as Ireland (89%), Switzerland (83%), Malta an existing license from another EU jurisdiction. (81%), Luxembourg (61%) and the Netherlands (59%). Cyprus funds are regulated by the Central Bank of Cyprus. The unique advantages of a Cyprus holding company There are several different types of funds that can be registered Although there is a number of countries that have been in Cyprus, each suited to different needs. established as reputable Financial centers in the European International Collective Investment Schemes can be set up Union and are in a position to offer some very attractive tax under a number of legal structures: advantages, none of these countries has managed to combine • A variable capital investment company (SICAV equivalent). together these benefits to the same extent as Cyprus, which • A fixed capital investment company (SICAF equivalent). in addition to the wide network of double tax treaties and the • A unit trust. full application of the EU directives, firmly put Cyprus in an • A limited partnership. enviable position both in the European Union and world-wide. • Cyprus, a full member of the European Union since 2004, The non-UCITS funds of Cyprus usually take one of three has the lowest corporate tax rate in all Europe at 10%. This forms: low corporate rate of tax is possible mainly due to the small • Experienced investor fund. size of Cyprus and consequently the size of the budget of • Private scheme with a focus on risk capital investment. the Republic of Cyprus and the fact that smaller in size EU • Retail fund. members, that cannot compete in heavy industry-technology The “can-do” culture of the practitioners and the accessibility can only compete by finding ways to attract foreign investment. to the regulator are further reasons for choosing Cyprus as an Cyprus has over the last two decades, been used extensively alternative jurisdiction for registering and licensing a fund. for International Tax planning by multinational companies from all over the world including the United States, Canada, By Angelos Gregoriades major European countries like Germany, the UK, Denmark Board Member, Head of Tax and Corporate Services and Sweden. It is a fact that most of the investment that went of KPMG Cyprus 35
1-47 main text Final ISJ47.indd 35 04/06/2010 18:33 The ISJ Profile Gary Probert INDUSTRY CUTTING From the East End to the (American football), the Celtics (basketball) and the Bruins (ice hockey). He also ended up at Charles River Rugby Club in Boston, where he RELEVANT EDGE East Side played until the mid 1990s MARKET Gary is focused on the dedicated work of ISITC on a daily basis as What do the East End of London, Boston and it pursues its mission: to improve the quality of communication and the EXPERT LEADING New York City all have in common? The answer percentage of straight-through-processing throughout the trading life cycle. is that they are all important places in Gary He calculates that he spends the equivalent of two to three days a month TUITION Probert s career. From the Boleyn Ground in on the ISITC job, with the full support of his employers. East London (West Ham United Football Club s He became Chairman at the start of January this year, and his two- home ground), to Boston, Massachusetts, to year stint in the role will end on December 31 2011. Comprised of 1,500 Wall St, one lively and animated connecting individuals from 350 companies worldwide, ISITC provides members with thread is the current Chairman of ISITC the means to revolutionise the securities trading process. ISITC brings (The International Securities Association for together broker/dealers, custodians, investment managers, vendors/ Institutional Trade Communications). utilities and other industry professionals to develop proposed standards Born in Stratford and raised in East Ham in that are designed to enhance efficiencies in trade processing and the London Borough of Newham, Gary moved related communications. ISITC s members work hand-in-glove to reduce to Boston in 1983 with his wife Laura, whom inefficiencies, lower risk and build shareholder value while developing and he met in London. The move to New York City promoting the global securities industry. Further information can be found followed in 2000 after he was hired by the then on its website: www.isitc.org. Salomon Smith Barney to run its equities middle Gary is supported by the ISITC Board of Directors, comprising several office. members from major financial institutions. The Board includes First Vice After moving to Boston he found employment Chair Jan Snitzer (of Loomis, Sayles & Company), Second Vice Chair at Bank of Boston, then at Fidelity Investments, Norman Papazian (of State Street Corporation), Immediate Past Chair before the move to New York. Today, he Genevy Dimitrion (of State Street Corporation), Treasurer Tom Murphy (of is Managing Director and a global product Citibank Global Markets), and Secretary Jocelyn Flaherty (of Omgeo). manager with the Citi Electronic Markets team., ISITC is comprised of several Working Groups who focus on specific within Citi s Securities and Fund Services. He areas, including Derivatives, Payments, Reconciliation, Settlements, and focuses primarily on Execution to Custody, Corporate Actions. These Working Groups work closely together to help TARGETED SPECIALIST an initiative that links Citi s trading execution develop best practices for the industry in an effort to promote efficiency. capabilities with its custodian network. The most recent evidence of this work is the recently released Market TRAINING STAY AHEAD KNOWLEDGE Gary is an avid fan of West Ham United but Practice Recommendations for Mutual Fund Trailer Fee Payments, after moving to the States, was faced with a released in early February this year. Mutual fund trailer fees are the fees new challenge. Many British expatriates fail to paid by mutual fund companies to distributors for marketing or shareholder adapt to life outside the UK, but with little or no servicing of funds. The Market Practice focuses on two primary challenges information readily available in the US about surrounding trailer fee payment processing: the ability to identify payments British sport, Gary became enamoured of US as being specific to trailer fee processing, and a defined method for sports. I became a big Boston sports fan, he including required payment calculation details, which are needed to For more information visit: recalls. The Red Sox (baseball), the Patriots reconcile each of the payments. The recommendations explain how Selected Courses 2010 market participants can leverage the ISO 200022 payment clearing and settlement message to deliver trailer fee payments and required Hedge Funds supporting detail information in all currencies. www.fi ntuition.com Understanding Hedge Funds post Madoff Era 18 Feb - 19 Feb This is the first Market Practice addressing messaging in support of Hedge Fund Strategies 3 Mar - 4 Mar such payments. The ISITC Payments Working Group developed these Due Diligence on Hedge Funds 16 Mar guidelines to improve payment processing across the mutual fund industry, Book your place online Managing Hedge Fund Risk 23 Mar - 24 Mar it reminded us at the time of launch. Historically, trailer fee payments Credit Derivatives and Hedge Funds 17 May have been processed manually, and there has not been a high degree of Prime Brokerage 7 Jul - 8 Jul transparency or efficiency in executing and receiving them,” notes Norman or call us today on: Performance Measurement of Hedge Funds 1 Sep - 2 Sep Papazian, Executive Sponsor of the ISITC Payments Working Group. We developed this Market Practice to address these shortcomings in the industry, and we encourage firms to adopt these standards in order +44 (0)8452 30 30 65 Securities Finance to improve the industry’s workflow as a whole.” By adopting the Market International Securities Lending 20 Jan - 21 Jan Practice standards, mutual fund distributors would benefit from increased Equity Finance & Structured Products 25 Feb - 26 Feb transparency into payments and a better understanding of the calculation FinTuition is an international training Bond Financing (Repo) 15 Apr - 16 Apr methodology being used to determine the payment amount. In addition, company based in London specialising the non-USD currency payments process would become more automated Securities Services and in turn, eliminate the use of paper statements and checks. in the securities fi nance business: Understanding Basel II 16 Feb - 17 Feb “ISITC is continually focused on the issues facing financial institutions securities lending, equity fi nance, Securities Operations Clearing & Settlement 30 Mar - 31 Mar today and how to address these issues head-on, says Gary Probert. This hedge funds, prime brokerage, repo Global Collateral Management 27 Apr - 28 Apr Market Practice was developed through the valuable input of our member firms, who represent the world’s largest mutual fund companies. It is only and collateral management. through their insight and hard work that we are able to continue identifying and solving our industry s challenges. ISITC strives to continue to raise market standards. There are many The Global Series of International Securities Lending Seminars different processes we can improve, and our subject matter member In association with experts are committed to implementing data & business standards to Starting with Stockholm, Sweden 27 Jan 2010.
increase the efficiency of trade processing,” concludes Gary Probert. One day seminars giving insight into the world of securities lending as background Global Securities to GSL Summit Series. The course is designed for professionals looking for a solid GSL | Lending 36 fundamental understanding of this business.
1-47 main text Final ISJ47.indd 36 04/06/2010 17:27 FinTuition world tour ad blue no lines.indd 40 18/01/2010 12:52 INDUSTRY CUTTING RELEVANT EDGE MARKET EXPERT LEADING TUITION
TARGETED SPECIALIST TRAINING STAY AHEAD KNOWLEDGE
For more information visit: Selected Courses 2010
Hedge Funds www.fi ntuition.com Understanding Hedge Funds post Madoff Era 05 - 06 October Hedge Fund Strategies 12 - 13 October Due Diligence on Hedge Funds 25 May Book your place online Managing Hedge Fund Risk 09 - 10 June Prime Brokerage 07 - 08 July or call us today on: Performance Measurement of Hedge Funds 01 - 02 September
Securities Finance Equity Finance & Structured Products 07 - 08 June +44 (0)8452 30 30 65 Bond Financing (Repo) 02 - 03 November International Securities Lending 07 - 08 September FinTuition is an international training company based in London specialising Securities Services Understanding Basel II 22 - 23 June in the securities fi nance business: Securities Operations Clearing securities lending, equity fi nance, & Settlement 24 - 25 November hedge funds, prime brokerage, repo and Global Collateral Management 22 - 23 September collateral management.
The Global Series of International Securities Lending Seminars In association with Starting with Stockholm, Sweden 27 Jan 2010. One day seminars giving insight into the world of securities lending as background to GSL Summit Series. The course is designed for professionals looking for a solid fun- damental understanding of this business.
1-47 main text Final ISJ47.indd 37 04/06/2010 17:41 Euroclear capital markets and risk
returned, but confidence remains fragile, the focus has Restoring Confidence to our moved from senior members of financial institutions to sovereign debt valuations. Despite the bail-out package Capital Markets by John Trundle, for Greece, markets remain very jittery. The restoration of confidence in and within the capital markets will be a long Chief Risk Officer at Euroclear journey.
Leveraging a robust infrastructure The recent financial crisis hit Not all the news is bad. Baron Lamfalussy, a leading figure in the financial markets, summed up the pivotal role of confidence in and within the exchanges, central counterparties (CCPs) and central financial sector – very quickly. securities depositories So how were the (CSDs) during the crisis The public outrage at the sector knock-on impacts of in 2008: “The clearing, Lehman contained? settlement and payment is disturbing, but not surprising. systems deserve particular Many of the questions that The primary factor praise. Few people, including is that 99% of all financial market participants, stakeholders and the public are let alone governments and credit extended by the general public, are aware now asking are valid. Euroclear Bank to of the amount of effort that How could it have happened? its clients is backed has been invested over the past 20 years into enhancing How can we ensure that such by collateral. the crisis resistance of these systems. The investment has been rewarded by high a crisis will not happen again? returns.” How can we trust any financial Major credit-related events, such as the collapse of Lehman Brothers, rigorously tested risk models and institution again? infrastructure service providers. They underscored the need to have resilient risk management policies and programmes The sector also lost confidence in itself, as seen in the in place for all types of financial institutions, including collapse of the interbank market. A semblance of trust has 38
1-47 main text Final ISJ47.indd 38 04/06/2010 18:29 Euroclear capital markets and risk
infrastructure service providers. The most constructive the need to take a globally co-ordinated approach realisation to come out of this crisis is that infrastructure when implementing such changes. Failure to do so will service providers such as Euroclear Bank, the only ICSD undoubtedly result in regulatory arbitrage where financial with which Lehman chose to do business, have been able centres with more onerous regulations will find themselves to test and prove the effectiveness of their crisis and risk at a disadvantage to markets where regulations are more management procedures. relaxed. Efforts are underway to co-ordinate within Europe, So how were the knock-on impacts of Lehman contained? between Europe and the US, and globally though Basel and The primary factor is that 99% of all credit extended by the G20. The widest possible agreement will be needed if the Euroclear Bank to its clients is backed by collateral. The measures are to be effective. remaining 1% is typically extended to very high quality counterparties like central banks. Thus, Euroclear Bank’s Governance roles credit exposure on Lehman Public outcry over financial market failure has been Public outcry over Brothers was fully covered and exacerbated by perceived excesses and arrogance shown financial market closed out without any credit by some bankers – and the most potent symbol has been loss, or disruption to clients or their sizeable bonuses. Regulators want to ensure individual failure has been the market. The single-purpose incentives are aligned with the long-term interests of the exacerbated bank status of Euroclear Bank, firm. The financial industry is seeking to resolve these by perceived i.e. intra-day credit is granted compensation imbalances, which will be crucial in restoring exclusively to avoid settlement public confidence in the financial industry. excesses and fails, means that credit risk is Ultimately – whether talking arrogance shown very short term, transaction National central about regulatory effectiveness by some bankers. related and managed precisely. or financial institution Other market infrastructures banks have played management – there is no proved to be equally robust. In the foreign exchange a crucial role in substitute for good judgement. settlement area, CLS (Continuous Linked Settlement) bringing some This requires countering views, withstood the turmoil, having processed a peak of over especially the voices of caution, 1.5 million instructions, representing over 95% of all global stability back to to be heard loudly at the top foreign exchange activity, on a single day in September our capital markets tables. 2008. CCPs like LCH.Clearnet successfully and relatively during the recent Risk management no longer quickly wound down Lehman Brothers’ OTC interest rate resides within a specific division swap positions, which represented a notional value of around crisis. But, they that produces quarterly reports USD 9 trillion encompassing over 65,000 trades in five need to address for management or the Board. major currencies. Lessons have been learnt in managing the and implement Risk management needs to be process, but the overall picture is very encouraging. part of the corporate culture, their exit strategies undertaken by all areas of Renewed regulatory focus to enable the the organisation. Risks need Regulators worldwide want to extend the benefits of to be managed within a well-constructed infrastructure further by pushing more markets to function comprehensive risk framework, OTC derivatives transactions through a central clearer. properly. with policies related to each This can increase resilience, but is not a silver bullet. Such of the relevant risks and a legislation must not compromise a CCP’s ability to manage governance structure that makes clear the responsibilities counterparty and systemic risks. The CCP needs to be able for monitoring and control. Formal but pragmatic processes to protect its own position and, accordingly, clear instruments must be in place covering both day-to-day business practices only where it can price and margin them reliably. The and the necessary control processes, which include the challenge for regulators will be to balance the extension of identification, monitoring and mitigation of risks, and incident a new range of securities with the need to protect the CCP management processes. But, the single most important itself. factor in good risk management is the tone from the top. Another initiative to boost confidence in financial National central banks have played a crucial role in institutions is the level of capital a firm should hold as Tier bringing some stability back to our capital markets during the 1. This will rise. There is no single right answer, not only recent crisis. But, they need to address and implement their because of measurement exit strategies to enable the markets to function properly. Regulators want to problems in assessing risks, It will take time. Trust, when lost, is not easily restored. ensure individual but also because it depends It will require a large number of small measures and a on how safe the regulators prolonged period of providing reliable financial services incentives are want the system to be. There to the wider community. Infrastructure can play its part aligned with the are trade-offs to consider by maintaining its resilience and adapting its services to long-term interests in setting new and higher evolving market needs. thresholds. Yes, higher Tier 1 of the firm. ratios would strengthen a firm’s John Trundle is the Chief Risk Officer at Euroclear SA/NV ability to withstand adverse credit events. But, higher capital Financial Services Brussels Area, Belgium and a member of adequacy thresholds will increase the cost of intermediation the Euroclear Group Management Team. and reduce financing needs, which may have an adverse John Trundle’s previous positions include Head of affect on jobs, economic growth and social welfare. Business Continuity Division at Bank of England, Head of One of the important challenges facing national Market Infrastructure Division at Bank of England, and the governments and financial supervisory authorities is Governor’s Private Secretary 39
1-47 main text Final ISJ47.indd 39 04/06/2010 18:29 gains and losses Mandate News
John Lewis Anoints J. P. Morgan co-ownership where all 70,000 staff are Partners in the J.P. Morgan s Worldwide Securities Services business business. has finally made it to the top. It has been anointed by It was also recently the subject of a very friendly three- John Lewis, England s favourite retailer. part fly-on-the-wall documentary series shown on BBC2. J.P. Morgan will provide custody, accounting, Oh, and one other thing, it is arguably best known not performance measurement, FX, compliance, cash just for its quality of service, but for its motto: ‘Never sweep and securities lending services to The John Knowingly Undersold’. This means that it will match any Lewis Partnership Pensions Trust, which has in excess lower price that a customer can reasonably find for the GLOBALFUNDS of £2 billion in total assets under management. The same item elsewhere. ISJ can’t help wondering whether securities lending programme has been specifically that same principle applied in the beauty contest for this designed to meet The John Lewis Partnership Pensions particular mandate. Trust requirements; the complex transition required global coordination with J.P. Morgan s borrower network Hewitt to immediately meet the client’s collateral investment J.P. Morgan s Worldwide Securities Services business Ireland funding requirements. has been awarded a mandate to provide custody and “We found J.P. Morgan’s offering to be superior to its related services to pan-European defined benefit pension competitors, including the scope of its securities lending, schemes advised by Hewitt Delegated Consulting accounting and performance measurement services, and Services. have been very impressed with its highly efficient on- J.P. Morgan will provide custody, transition boarding programme,” said Andrew Chapman, The John management, accounting, performance measurement, Lewis Partnership’s Pension Investment Manager. FX, compliance, securities lending and trustee services The John Lewis Partnership operates 28 UK to support Hewitt pension fund clients throughout Europe, department stores, 225 Waitrose supermarkets and three of which, with a total of more than £450 million Greenbee.com. The business has an annual turnover in assets under management, are already using J.P. of over £7.4bn. It is the UK’s largest example of worker Morgan s services. Hewitt Delegated Consulting Services allow pension Quis Custodiet Ipsos Custodes? scheme investment specialists to manage and execute Who Guards The Guardians is the usual literal translation a scheme’s investment policy efficiently. The trustees of the Roman poet Juvenal’s oft-quoted question: Quis still set the strategic framework and provide regular Custodiet Ipsos Custodes? It suddenly became relevant oversight, but the service then manages and executes to the modern world when the Guardians of New Zealand the investment strategy against strict parameters. As Superannuation announced in mid-April that they had a result, a scheme benefits from rapid responses to terminated the global equity, non-US small-cap equity and changing market and/or solvency conditions, and can take multi-strategy equity mandates managed by GMO. opportunities to lock in gains. GMO was appointed in June 2004 to manage a non-US small-cap mandate, in February 2005 to manage a growth- oriented global equity portfolio and in June 2006 to manage KLP Awards Global Custody and Depositary Bank a multi-strategy equities mandate. ISJ immediately asked Mandate to Northern Trust and Handelsbanken the Guardians for further background to their actions, asking Partnership politely bluntly why the mandate has been terminated. Is Kommunal Landspensjonskasse (KLP), one of it for performance-related or other reasons? We are still Norway’s largest life insurance companies, appointed waiting for an answer. Northern Trust and Handelsbanken to provide custody In the meantime, GMO Renewable Resources Ltd and depositary services for assets managed on behalf continues to manage the Fund’s New Zealand timber of its funds and insurance businesses. In 2004, Northern assets. This decision does not affect the New Zealand Trust became the first global custodian to partner with a Superannuation Fund’s strategic asset allocation to global pan-Nordic bank to provide custody and related services listed equities, the NZSUPERFUND tells us. to a mutual fund. KLP was the first Norwegian mutual The New Zealand Superannuation Fund, which fund to select Northern Trust and Handelsbanken for their commenced investing at the end of September 2003, is innovative mutual fund solution. designed to reduce the tax burden on future New Zealand taxpayers of the cost of New Zealand superannuation. Citi Japan Mandate An ageing population means the cost of providing New Citibank Japan Ltd Securities Services has been Zealand superannuation is expected to double over the next appointed by Interactive Brokers Securities Japan, 50 years. To prepare for this, the Government has made Inc. (IBSJ) to provide third-party clearing services for contributions to the Fund while the cost of superannuation IBSJ’s Japanese equities trades on the Tokyo Stock is relatively low. The Fund will invest the money on a prudent but commercial basis and the Government will Exchange (TSE) with immediate effect. CJL will handle begin to make withdrawals from 2031, when the cost of all of IBSJ’s clearing and settlement obligations in this superannuation has increased. As at 28 February 2010 the market and will implement a linkage to Japan Securities value of the Fund was NZ$16 billion. The Guardians work Depository Center, Japan’s central securities depository, with investment managers around the world to execute as required by local regulations. The move follows the strategy for investing the Funds. A list of investment Interactive Brokers’ 2008 acquisition of Japan’s Moriai managers, now, presumably, minus GMO, can be found on Securities, a fully-licensed broker-dealer, which was the Fund’s website www.nzsuperfund.co.nz. subsequently renamed IBSJ.
40
1-47 main text Final ISJ47.indd 40 04/06/2010 19:38 New format supplement out with the next issue of ISJ
“Ireland now GLOBALFUNDS deservedly stands out as a global centre for funds.” Ireland Brian Lenihan, T.D. Minister of Finance
KEYNoTES Editorial features include: - MINISTER oF FINANCE Fund Facts... - EURoPEAN UNIoN - IFIA Irish Regisitered Annual Global Funds - full - NICSA UCITs Funds review of the IFIA’s Conference (Net Asset Value - Euro Mn) The risk reward - why Ireland appeals to the new hedge fund investor 1991 776 1992 2,212 Return to growth - advisor FEATURES 1993 6,311 - USA & UCITS bottlenecks and technology catch up - ADVISoR SURPISE 1994 8,053 - ASIA - PIIGS oR SoUTHERNERS? 1995 11,829 Ucits IV, the next chapter 1996 14,762 Ucits IV, the next chapter in the Ucits story, is due to be effective 1997 20,749 mid-2011. In anticipation of the Ucits IV era, tax considerations are dominating the agenda and in this respect Ireland has already 1998 42,987 progressed to consideration of the tax issues as they relate to Ucits management companies, master feeder structures and fund 1999 94,502 mergers. In his budget speech finance minister Brian Lenihan high- PEoPLE 2000 145,399 lighted the industry-led activity to prepare the tax environment for - INDUSTRY LEADERS the new Ucits era to ensure that the rationalisation opportunities - FUND MANAGERS 2001 214,888 included in Ucits IV bring with them tax certainty and no adverse - FUND ADMINISTRAToRS 2002 238,467 tax implications for the funds concerned and their underlying investors. 2003 285,642 So, what has the evolutionary tale of Ucits together with the in- dustry activity in Ireland to enhance the efficiencies of Ucits got to 2004 343,377 DIRECToRY do with the AIFM directive? Simply to demonstrate how, when the - FUNDS AND SERVICE 2005 465,339 fundamentals are correct, a firm foundation for a truly internation- PRoVIDERS IN IRELAND al investment fund structure can be established, which can evolve 2006 582,737 to reflect changing conditions and requirements and whose scale of operation will encourage the pursuit of operational efficiencies. 2007 647,469 A similar opportunity now exists in the non-Ucits space and if col- 2008 517,702 lectively we can prepare the architecture, the extent of the prize is known. However, should we fail to achieve or fall short in our 2009 (Aug) 571,845 efforts it will certainly be an opportunity missed. 2010 ? Gary Palmer, chief executive of the Irish Funds Industry Association
1-47 main text Final ISJ47.indd 41 04/06/2010 19:38 gains and losses Mandate News Supported by
Singapore Sling administration needs in Asia as well as those of our global RBC Dexia Investor Services has extended its investor base,” said Masashi Ohmatsu, Senior Director & relationship with Aisling Analytics, a hedge fund in CEO at UOBAM Japan. “The enhanced functionality and Asia, to include custody, fund administration and transfer efficiencies which BNY Mellon’s appointment brings will agency for the Merchant Equity Fund, its recently enable us to deliver even greater value to our clients.” launched long-short resource equity fund. RBC Dexia said the mandate strengthens its position as an end-to- Seadrill Digs BNYM end service provider in Singapore in both the long only, BNY Mellon (BNYM) has been appointed transfer long-short, and alternative investment space.”We have agent for Seadrill Ltd, an international offshore drilling a longstanding back office outsourcing relationship with company. Seadrill is listing its common shares on the RBC Dexia”, Michael Coleman, Managing Director of New York StockExchange in addition to its listing on the Aisling Analytics reminds regular readers. Oslo Stock Exchange. BNY will provide transfer agent and cross-border share transfer services for the NYSE- BBH Win Underlines Renewed Focus on Reputation listed shares. BNYM’s mandate started on April 15, the in Modern Markets date on which Seadrill’s new listing took effect. Out of the Dublin offices of Brown Brothers Harriman “BNY Mellon’s global network of resources for cross- comes news that BBH has been appointed as custodian, border securities servicing was an important reason administrator and transfer agent to Neuberger Berman for their selection”, said Jim Dåtland, Seadrill’s Vice Investment Funds PLC. President of Investor Relations. “BNY Mellon helped us Launched in December 2000, Neuberger Berman identify and work through unforeseen obstacles in the Investment Funds PLC is a Dublin-domiciled UCITS process. We now look forward to realising the benefits of offering investors access to a broad range of equity and a US-based listing, including enhanced liquidity for our fixed income asset classes. The range of nine sub- securities.” funds includes US, China and global equity funds, as well as high yield and currency funds. The range offers BNYM - Fuh Hwa Completes Trio of Wins 75 share classes registered for distribution in the United BNY Mellon Asset Servicing has been appointed as Kingdom and other major European jurisdictions including global custodian by Fuh Hwa Securities Investment France, Germany, Italy, Netherlands, Spain, Sweden, and Trust (Fuh Hwa) for its new mutual fund, Fuh Hwa Global Switzerland. Commodity Fund. The new Fund launched on 6 April Underlining the renewed focus on trust, credibility and 2010. Fuh Hwa was established in June 1997 and claims reputation that has developed in recent trubled times is to be the largest securities investment trust in Taiwan with the otherwise anodyne PR-driven quote from Dik van assets under management totalling approximately US$6 Lomwel, head of Neuberger Berman Europe and Middle billion as at 26 February 2010. East: “We are committed to delivering an exceptional “We chose BNY Mellon not only because of their service for our clients and were impressed by BBH’s sophisticated custody platform, but because it was vital experience, expertise and ability to meet our international to choose a partner who has a strong balance sheet business requirements. A reputable service provider is and high credit ratings to ensure the safekeeping of key in the current economic environment and we are our investment assets,” said Anne Mao, Associate Vice confident in their capacity to ensure the safekeeping of President at Fuh Hwa our assets.” “The underlying fundamentals of Asia appear relatively Established in 1939, Neuberger Berman is one of the strong and the consensus is that Asia’s long term growth world’s largest private, independent employee-controlled advantage will lead to the region increasingly becoming asset management companies, managing approximately the engine of the world’s growth,” said Chong Jin Leow, $173 billion in assets as of December 31, 2009. Head of Asia, BNY Mellon Asset Servicing. “The rising number of investment vehicles is, in turn, fuelling the need for services from custodians who can provide strong UoBAM Turns To BNYM infrastructures which are transparent, cost-effective, and UOB Asset Management has named BNY Mellon Asset help institutions manage risk in the global markets.” Servicing as the trustee, fund administrator and custodian BNY Mellon has had a presence in Taiwan for of its Cayman-domiciled United Asia Bond Multi Currency almost four decades. It provides products and services Fund. This Fund is part of UOBAM’s United Multi Asset to Taiwanese institutional investors including treasury Strategy Fund and as at 31 March 2010, the United Asia services, asset servicing, depositary receipts and foreign Bond Multi Currency Fund had approaching JPY5 billion exchange services. The Taipei branch is one of the (US$50 million) in assets under management. oldest foreign banks in Taiwan having been in operation Tap into the brains of UOBAM is headquartered in Singapore, with regional since the early 1970s. One cannot help wondering if business and investment offices in Malaysia, Thailand, perhaps Chiang Kai-Shek, the loser in the battle for your industry colleagues. Brunei, Taiwan and Japan. UOBAM has more than 20 control of mainland China after the Second World War, years of experience in investing in equities and fixed who then became President of the Republic of China and The Benche is a web community for professionals income instruments of regional and global markets. served as Director-General of the Kuomintang, was one within trade finance, cash management and custody. “We chose BNY Mellon as our fund administrator of its early customers. as they are highly regarded in the industry for having Its purpose is to encourage sharing of knowledge a robust global infrastructure which can support our Please send details of mandate wins to [email protected] and experience, open discussions and networking. Join us at www.theBenche.com 42
1-47 main text Final ISJ47.indd 42 04/06/2010 19:38 Supported by
Tap into the brains of your industry colleagues.
The Benche is a web community for professionals within trade finance, cash management and custody. Its purpose is to encourage sharing of knowledge and experience, open discussions and networking.
Join us at www.theBenche.com
1-47 main text Final ISJ47.indd 43 04/06/2010 19:38 out and about Pugilism and Paintings
Bankers Up For A Fight: FBI Hostage Teams, US Border Patrol and US Treasury offi cers. He is no less than ‘The Man’ that these agencies 19th Annual consult when training for a ‘kill-or-be-killed’ situation. He in association with Is Combat Training The Next is co-author of the book, How to Survive The Most Critical 5 Seconds of Your Life (which in terms of strict publishing international securities Big Thing? style should really be called How to Survive The Most Critical Five Seconds of Your Life, because the numbers You may think that bankers are only interested in fat one to nine are normally spelled out in full while numbers lending conference bonuses, but according to combat training expert Tim above 10 are expressed in digital terms, but that is sheer Larkin they are increasingly interested in learning how pedantry, practised at a safe distance from ‘The Man’). He 22-24 June 2010 | Adlon Kempinski, Berlin, Germany to fi ght! Larkin, from Las Vegas, is the creator of ‘Target also co-authors the online newsletter, Secrets for Staying Focus Training’ (TFT) and teaches entrepreneurs and Alive When Rules Don’t Apply. bank executives how to protect themselves using ‘extreme’ This is the only event of its kind in Europe, attracting in excess of 400 senior market participants violence. He has just launched a publicity offensive (no pun intended). from banks, broker dealers, asset managers, pension funds, hedge funds and policy makers. Giiven the scraps with Governments and regulators that look likely to lie in wait for banks in the wake of the allegations of fraud recently laid at the door of Goldman Sachs, it probably couldn’t be better timed. “I have senior executives from banks like Credit Suisse, Goldman Sachs keynote sPeaker: and J.P. Morgan Chase enrolled on my courses,” he says. He organises training workshops to demonstrate AlAstAir CAmpbell, former Advisor to Tony Blair self-defence techniques which help bankers and other professionals to recognise when they’re in dangerous situations and the techniques to protect themselves when attacked. The workshops teach practical ways to stop an armed attacker to increase personal safety, especially when travelling in higher-risk continents such as Africa or Latin Out and About ParticiPants will be able to: America. • determine how new regulations might impact on the future growth of the market for both the supply Corporate clients principally attend Mr Larkin’s TFT BNY Mellon Van Gogh seminars, which include instruction in how to kill. But this and the demand side is not any old killing, which is bad. This is killing people Hats off to BNY Mellon for its sponsorship of The Real • assess whether there will be any substantial changes in the market infra-structure for protection when they are visiting markets in emerging Van Gogh: The Artist And His Letters exhibition which has countries, which has an altogether different moral just fi nished its three-month run at the Royal Academy on • learn how tighter rules on bank capital and liquidity affect the terms on which borrowers do business tone. “Most people feel very uncomfortable with the idea London’s Piccadilly. Following the events that have unfolded of violence because we have stigmatised it so much,’ he since July 2007, it takes guts for any fi nancial institution to • debate with beneficial owners: Do they consider the risk/return profile of securities lending to be worth it? explains. ‘But I try to impress on students that violence is be doling out money to projects that lie so far beyond their just another tool. You need visions in your head so you can non-core business, and especially to projects that some replicate them when you try to do them.” Philistines will no doubt label elitist. The exhibition provided a His publicity material cites as an example Krista Waddell, near once-in-a-lifetime opportunity to see signifi cant volumes for more information Please contact: find out how to get involved: the CEO of Ounces2Pounds. She has enrolled on the of the work of this remarkable artist up close and personal, Michala Kocurova +44 (0)20 7743 9337 Fleurise Luder +44 (0)20 7743 9361 courses for four-and-a-half years. She travels extensively, and to discuss his often misunderstood ‘madness’ with [email protected] [email protected] organising gold parties in the UK, US and Australia, which sympathetic modern listeners. “He was a manic depressive,” gives her something of an incentive to learn how to look commented one particularly empathic journalist from the after herself. “Sometimes I walk out of a gold party with north of England in a strong accent reminiscent of the hard- £2,000 worth of gold and it can be dangerous especially working and versatile actress Jane Horrocks. “If he’d had the sPonsors and exhibitors because I travel on my own,” she said. Armed with that right medication he would have been all right!” knowledge, fi nance ministers the world over might well be We tip our hats too in the direction of the Scylla and keeping an eye out for her wending her way home after Charybdis of the security world on duty to prevent impatient future parties. reporters, and BNY Mellon employees, from gaining Waddell, who is also a black belt in Tae Kwon Do, says entrance a second or two ahead of the allotted time on the that she has found TFT very effi cient. ‘He teaches you the special viewing evening on April 12. There is always, though, basics on how to survive,” she said. As well as learning a way round such minor obstacles for the committed and TFT for protection some executives have discovered that thirsty. combat training can improve their business decision- The exhibition proved well worth the effort, and the booty making. Tim Larkin reports that he was recently engaged bag that BNYM gifted to visitors included a jaw-dropping to train traders at the New York Mercantile Exchange; not book on the exhibition, but ISJ would like to offer a to improve their capabilities for violence but to help them suggestion, and pose one small question. The suggestion? clarify their aims when trading (ISJ, for what it’s worth, fails Keep speeches short. Steve Potter of Northern Trust’s is to spot any signifi cant distinction between the two!). the model to follow on nights such as these. “Hello, good “Many of them were telling me that they became evening, welcome, enjoy the evening, the food and the paralysed before making a trade by the amount of drink,” is basically his entire speech. A leisurely stroll through information and research going round their head. The the history of the planning exhibition, in what seemed like combat training somehow helped them focus their priorities real-time, was not the note to strike. And the question? Is the Please visit the event website for a full list of sPeakers and to register your Place today. and read the situations better,” he said. Tim Larkin claims serving of prosecco rather than champagne a sign of these also to have trained the US Navy SEALs, Scotland Yard, straitened times??? www.afme.eu/isla2010 44
1-47 main text Final ISJ47.indd 44 04/06/2010 19:38 ISLA_ad203x267v2.indd 1 6/3/10 9:46:02 AM 19th Annual in association with international securities lending conference 22-24 June 2010 | Adlon Kempinski, Berlin, Germany
This is the only event of its kind in Europe, attracting in excess of 400 senior market participants from banks, broker dealers, asset managers, pension funds, hedge funds and policy makers.
keynote sPeaker: AlAstAir CAmpbell, former Advisor to Tony Blair
ParticiPants will be able to: • determine how new regulations might impact on the future growth of the market for both the supply and the demand side • assess whether there will be any substantial changes in the market infra-structure • learn how tighter rules on bank capital and liquidity affect the terms on which borrowers do business • debate with beneficial owners: Do they consider the risk/return profile of securities lending to be worth it?
for more information Please contact: find out how to get involved: Michala Kocurova +44 (0)20 7743 9337 Fleurise Luder +44 (0)20 7743 9361 [email protected] [email protected]
sPonsors and exhibitors
Please visit the event website for a full list of sPeakers and to register your Place today. www.afme.eu/isla2010
1-47ISLA_ad203x267v2.indd main text Final ISJ47.indd 1 45 6/3/1004/06/2010 9:46:02 19:38 AM KN2240ISJAD 203X267:Layout 1 20/4/10 10:29 Page 1
EndFree Investors For On 1st July 2010 GSL will host the inaugural Securities Lending Awards.
The best and brightest in the industry will be rewarded for their work over the previous year. Grimaldi Forum, Monaco 14 June: UCITS & Managed The purpose of the Awards is to provide the industry and its customers with a benchmark or Accounts Summit 15-17 June: Main Conference best practice via recognition with meaning and integrity. www.icbi-gaim.com Achieve Your Business Goals At The World’s Largest Hedge Fund Event The Vote NOW for the Best Securities Lending Industry Participants NEW Securities at www.gsl.tv/awards/vote - Your Vote Counts! Academic Hedge Fund Goals Investor Goals Lending & Industry Industry All industry practitioners can register to vote – the industry • Meet 300+ Active Investors In The • Discover 2010’s Top Performing Hedge Funds Awards decides on the industry winners. Research Alternatives World In Just One Week & Hedge Fund Strategies For 2010 2010 GSL Voting closes, Friday 11th June 2010 • Use Our Unrivalled Structured Networking To • Take Part In Our Structured Networking To Meet The Right Investor For Your Fund Meet Funds Of Interest To You
• Learn From The Top Hedge Fund Brands • Benefit From Our New Investor-Driven & We hope you are looking forward to the awards ceremony as much as we & The Renowned Industry Stars Comprehensive Programme are and will join us there in supporting rugby's Wooden Spoon charity. Professor Randy Cohen MIT SLOAN Author Of New Research On Meet More End Investors Than Ever Before Asset Allocation
Danny Truell Michael Powell Gerlof de Vrij Tony Broccardo Theodore Economou Larry Kochard Ricardo Weiss Diego Icaza THE WELLCOME UNIVERSITIES ALL PENSIONS BARCLAYS PENSION CERN PENSION GEORGETOWN FAPES-BNDES BBVA PRIVATE TRUST SUPERANNUATION GROUP (APG) FUND FUND UNIVERSITY PENSION FUND PENSION FUND, SCHEME BRAZIL PERU Nassim Taleb Principal UNIVERSA ASSET Hear From The Industry’s Biggest Stars MANAGEMENT Author Of New Research On Crowd Behaviour & Risk Perception
Mike Novogratz Bernard Oppetit Byron Wien Rick Sopher Elena Ambrosiadou Peter Clarke Hugh Hendry Steve Friedman FORTRESS CENTAURUS CAPITAL BLACKSTONE LCF ROTHSCHILD IKOS MAN GROUP PLC ECLECTICA ASSET EOS PARTNERS INVESTMENT GROUP ADVISORY SERVICES ASSET MANAGEMENT MANAGEMENT NEW Join Our UCITS & Managed Accounts Investor Summit Lawrence MacDonald Lehman Eyewitness The Exclusive Benefits Of Attending EXCLUSIVE: Meet New Hedge Fund Investors Author Of 14 June 2010 Meet NEW Investors & Asset Allocators Active In “A Colossal Failure of Answering The Needs UCITS & Managed Accounts Common Sense” Of The Post- Crisis Discover How To Fine-Tune Your Strategy Investor: Pitch Your Fund During The UCITS & Managed New Thinking On Accounts QuickFire Showcase Mario Therrien Olivier Couvreur Jose Galleano Mussie Kidane Liquidity & Transparency Receive An Exclusive Pass To The Investor Drinks CAISSE DE DÉPÔT AA ADVISORS 3A PICTET WEALTH In Hedge Fund Investing Reception & Meet The GAIM Investor Community ET PLACEMENT DU MANAGEMENT In Advance Of The Main Conference QUÉBEC
Yariv Itah What’s New For 2010? CASEY QUIRK & ASSOCIATES More Institutional Investors Than Ever Before – Meet more Hone Your Business Skills At 3 New Inspiring Mini-Workshops: Author Of New endowments, pension plans and foundations than at any other 1. How to deliver the perfect pitch for investment; 2 Mastering the The Securities Lending Industry Awards 2010 Research On alternatives event. art of rational decision making under pressure and 3 Using Key Industry Trends behavioural indicators to detect deception & uncertainty. For 2010 New Special Focus Investor Groups – Hear from Latin American The Landmark London Presented by Investors, Nordic Investors, Middle-Eastern Investors, Retails New Range Of Hedge Fund Strategies In Focus: Including Global Global Distributors & Fund Platforms. Macro, Fixed Income, CTAs, Systematic Trading, Credit, Distressed Debt, Environmental & SRI, Commodities. Securities READER OFFER New UCITS & Managed Account Investor Summit – This Thursday 1st July 2010 GSL Lending separately bookable summit (14 June) focuses on the new New Academic Research On Hedge Fund Asset Allocation By | 15% generation of liquid and transparent products renowned Hedge Fund Expert Professor Randy Cohen Of MIT DISCOUNT SLOAN Quote VIP: New Asset Allocation & Manager Selection Focus Day – Discover For tables and sponsorship how top end investors (Wellcome Trust, Barclays Pension Fund, New Enhanced Ways of Connecting & Promoting Your Fund contact [email protected] KN2240ISJAD CERN Pension Fund) are changing their asset allocation. (please turn over for more information)
1-47ISJ magazinemain text Finalad - voting.indd ISJ47.indd 1 46 04/06/201004/06/2010 19:38 18:15 KN2240ISJAD 203X267:Layout 1 20/4/10 10:29 Page 1
EndFree Investors For On 1st July 2010 GSL will host the inaugural Securities Lending Awards.
The best and brightest in the industry will be rewarded for their work over the previous year. Grimaldi Forum, Monaco 14 June: UCITS & Managed The purpose of the Awards is to provide the industry and its customers with a benchmark or Accounts Summit 15-17 June: Main Conference best practice via recognition with meaning and integrity. www.icbi-gaim.com Achieve Your Business Goals At The World’s Largest Hedge Fund Event The Vote NOW for the Best Securities Lending Industry Participants NEW Securities at www.gsl.tv/awards/vote - Your Vote Counts! Academic Hedge Fund Goals Investor Goals Lending & Industry Industry All industry practitioners can register to vote – the industry • Meet 300+ Active Investors In The • Discover 2010’s Top Performing Hedge Funds Awards decides on the industry winners. Research Alternatives World In Just One Week & Hedge Fund Strategies For 2010 2010 GSL Voting closes, Friday 11th June 2010 • Use Our Unrivalled Structured Networking To • Take Part In Our Structured Networking To Meet The Right Investor For Your Fund Meet Funds Of Interest To You
• Learn From The Top Hedge Fund Brands • Benefit From Our New Investor-Driven & We hope you are looking forward to the awards ceremony as much as we & The Renowned Industry Stars Comprehensive Programme are and will join us there in supporting rugby's Wooden Spoon charity. Professor Randy Cohen MIT SLOAN Author Of New Research On Meet More End Investors Than Ever Before Asset Allocation
Danny Truell Michael Powell Gerlof de Vrij Tony Broccardo Theodore Economou Larry Kochard Ricardo Weiss Diego Icaza THE WELLCOME UNIVERSITIES ALL PENSIONS BARCLAYS PENSION CERN PENSION GEORGETOWN FAPES-BNDES BBVA PRIVATE TRUST SUPERANNUATION GROUP (APG) FUND FUND UNIVERSITY PENSION FUND PENSION FUND, SCHEME BRAZIL PERU Nassim Taleb Principal UNIVERSA ASSET Hear From The Industry’s Biggest Stars MANAGEMENT Author Of New Research On Crowd Behaviour & Risk Perception
Mike Novogratz Bernard Oppetit Byron Wien Rick Sopher Elena Ambrosiadou Peter Clarke Hugh Hendry Steve Friedman FORTRESS CENTAURUS CAPITAL BLACKSTONE LCF ROTHSCHILD IKOS MAN GROUP PLC ECLECTICA ASSET EOS PARTNERS INVESTMENT GROUP ADVISORY SERVICES ASSET MANAGEMENT MANAGEMENT NEW Join Our UCITS & Managed Accounts Investor Summit Lawrence MacDonald Lehman Eyewitness The Exclusive Benefits Of Attending EXCLUSIVE: Meet New Hedge Fund Investors Author Of 14 June 2010 Meet NEW Investors & Asset Allocators Active In “A Colossal Failure of Answering The Needs UCITS & Managed Accounts Common Sense” Of The Post- Crisis Discover How To Fine-Tune Your Strategy Investor: Pitch Your Fund During The UCITS & Managed New Thinking On Accounts QuickFire Showcase Mario Therrien Olivier Couvreur Jose Galleano Mussie Kidane Liquidity & Transparency Receive An Exclusive Pass To The Investor Drinks CAISSE DE DÉPÔT AA ADVISORS 3A PICTET WEALTH In Hedge Fund Investing Reception & Meet The GAIM Investor Community ET PLACEMENT DU MANAGEMENT In Advance Of The Main Conference QUÉBEC
Yariv Itah What’s New For 2010? CASEY QUIRK & ASSOCIATES More Institutional Investors Than Ever Before – Meet more Hone Your Business Skills At 3 New Inspiring Mini-Workshops: Author Of New endowments, pension plans and foundations than at any other 1. How to deliver the perfect pitch for investment; 2 Mastering the The Securities Lending Industry Awards 2010 Research On alternatives event. art of rational decision making under pressure and 3 Using Key Industry Trends behavioural indicators to detect deception & uncertainty. For 2010 New Special Focus Investor Groups – Hear from Latin American The Landmark London Presented by Investors, Nordic Investors, Middle-Eastern Investors, Retails New Range Of Hedge Fund Strategies In Focus: Including Global Global Distributors & Fund Platforms. Macro, Fixed Income, CTAs, Systematic Trading, Credit, Distressed Debt, Environmental & SRI, Commodities. Securities READER OFFER New UCITS & Managed Account Investor Summit – This Thursday 1st July 2010 GSL Lending separately bookable summit (14 June) focuses on the new New Academic Research On Hedge Fund Asset Allocation By | 15% generation of liquid and transparent products renowned Hedge Fund Expert Professor Randy Cohen Of MIT DISCOUNT SLOAN Quote VIP: New Asset Allocation & Manager Selection Focus Day – Discover For tables and sponsorship how top end investors (Wellcome Trust, Barclays Pension Fund, New Enhanced Ways of Connecting & Promoting Your Fund contact [email protected] KN2240ISJAD CERN Pension Fund) are changing their asset allocation. (please turn over for more information)
ISJ magazine ad - voting.indd 1 04/06/2010 18:15 1-47 main text Final ISJ47.indd 47 04/06/2010 19:38 Investor To be listed, Services Journal Directory of Asset Servicing Vendors contact: ISJ [email protected]
Custody & Clearing
BHF Asset Servicing GmbH comprises the custody, depotbanking and securities services of BHF-BANK Aktiengesellschaft. With around Strahlenbergerstraße 45; 250 members of staff, approx. EUR 270 billion in assets under 63067 Offenbach a.M. administration and a depotbanking volume of EUR 85 billion, BHF Germany Asset Servicing GmbH is one of Germany’s leading specialists in •Contact: Moritz Ostwald depotbanking and custody business. It develops innovative and high- •Phone:+49 69 667744 838 class services for investment companies, institutional investors and •Email: moritz.ostwald@ foreign banks, and excels at tailoring solutions to the individual needs bhfassetserv.com of its clientele. Assets under Administration: EUR 270 bn No of funds: 478
DnB NOR is the leading provider of Custody, Clearing and Remote Member Service in Norway. DnB NOR offers a full range of securities T: +47 22 94 92 95 settlement, Corporate Action and cash management services for F: +47 22 48 28 46 both foreign and domestic institutional clients. The bank has a strong Contact: Bente I. Hoem, Head of commitment to the Custody business in Norway and the staff is highly Global Relations & Network knowledgeable and experienced. In addition, DnB NOR provides E: [email protected] a wide range of value-added services for foreign clients such as W:www.dnbnor.com Securities Lending, Income Collection, Proxy Voting, Tax Reclaim, and MIS reporting. As the largest commercial bank in Norway, DnB NOR offers clients full services in securities trading, registration, foreign exchange and Money Market.
Banking Securities Services provides award winning local and regional custody services for investment professionals. We are proud to be the For further information please largest custodian provider in terms of assets and number of foreign contact clients in Central & Eastern Europe. ING has been providing Securities Lilla Juranyi, Global Head Services in CEE since 1994 and we will continue our ongoing pursuit of Custody excellence through new technology. Innovation and client focus are the at + 31 20 7979 435 key drivers to service our clients the best way. or contact her by email: Other activities of ING Wholesale Banking Securities Services are [email protected] Paying Agency Services and web-based management of employee stock option & share plans. ING is your local partner in: Belgium, Bulgaria, Czech Republic, Hungary, Poland, Romania, Russia, Slovak Republic and Ukraine.
Intesa Sanpaolo’s Transaction Services include : • Sub Custody, Derivatives and Remote Membership Clearing Piazza della Scala 6 • Global Custody and Depository Bank for mutual funds, 20121 Milan, Italy pension funds, real estate funds, private equity funds and T: +39 02 8794 2466 hedge funds F: +39 02 8794 1519 • Fund Administration for mutual funds, pension funds, real W: intesasanpaolo.com estate funds, private equity funds and hedge funds C: Riccardo Lamanna • Paying Agent for foreign funds and sicavs E: riccardo.lamanna@ • Cash and Payment services like swift to checks, mass intesasanpaolo.com payments, checks and cash letters
Nordea is the leading financial services group in the Nordic and Baltic region and operates through three business areas: Nordic Banking, Private Banking and Institutional & International Banking. Nordea is the leading custody services provider in the region. Nordea provides high quality, tailor-made custody services for local and foreign investors dealing with Nordic and Baltic securities. Due to the unique history of being formed from four established banks, Nordea is the only Nordic Contact: custody provider with strong local presence and expertise in all four Nina Groth markets. Nordea combines Nordic competence with local expertise, Head of Sub-custody and and has proven ability to deliver high quality services that meet both Clearing clients’ and each local market’s requirements. Tel: +45 3333 6124 • Leading Nordic custodian: E-mail: [email protected] • Critical mass and resources available; • deep local experience and active involvement in each Nordic market; • Complete operational capabilities and best-fit systems developed in each Nordic market; • Proven ability to deliver high-quality service in all Nordic markets; Excellent connection with key players in all Nordic Markets; • Extensive product and service offering; • Your single point of entry to the whole Nordic region.
48 raw Directory ISJ47.indd 48 03/06/2010 20:13 RBC Dexia Investor Services offers a complete range of investor services to institutions worldwide. Our unique offshore and onshore solutions, combined with the expertise of our 5,300 professionals in 71 Queen Victoria Street 16 markets, help clients grow their business and sustain enhanced London EC4V 4DE, UK performance through efficiency improvements and robust risk C: Tony Johnson management practices. T: +44 (0) 20 7653 4096 Equally owned by RBC and Dexia, the company ranks among the E: [email protected] world’s top 10 global custodians with USD 2.5 trillion in client assets W: http://www.rbcdexia.com under administration. RBC Dexia’s innovative solutions include global custody, fund and pension administration, shareholder services, distribution support, securities lending and borrowing, reconciliation services, compliance monitoring and reporting, investment analytics, and treasury services.
Santander is Spain’s leading financial institution and the largest bank in the euro zone by market capitalization. Our commitment and T: Europe: (34) 91 2893932 / 28 contribution to the securities industry is well established after more T: USA: (1212) 350 39 02 than a century of providing services in this field. W: santanderglobal.com Santander’s cutting edge technology enables it to offer a E: globalsecurities@ comprehensive array of innovative services in a broad range of gruposantander.com markets. Santander currently has full local capabilities in Iberian and Latin American markets along with a franchised presence in many others. Santander`s experience and product range ensures that every aspect of the securities business is fully contemplated.
SEB is the leading provider of securities services in the Nordic and Baltic area. We are committed to custody and clearing processes for the wholesale market. We hold securities worth over EUR 500 bn and provide services in more that 80 markets, 11 of them under the SEB C: Goran Fors name (Sweden, Norway, Finland, Denmark, Luxembourg, Germany, T: +46 8 763 5770 Estonia, Latvia, Lithuania, Russia and Ukraine). E: [email protected] We offer a full range of securities services including corporate W: http://www.seb.se action and information services, securities lending and services to remote members of the Nordic and Baltic stock exchanges. We are also General Clearing Member on all CCP´s covering Nordic securities. We continuously develop new products in connection with clients and partners to ensure we deliver the high-quality products our clients demand. We always strive to make the processes more efficient. With a history of 150 years in the securities industry; we know the market and our clients well. Sébastien Danloy Société Générale Securities Services offers institutional investors, Global Head of Sales, asset managers and financial intermediaries a comprehensive range Investor Services of financial securities services: custody, clearing & trustee services, Société Générale Securities fund administration, asset servicing and transfer agency. SGSS Services currently ranks 3rd European custodian and 9th worldwide custodian T: +33 (0)1 41 42 98 65 (Source: Globalcustody.net) with EUR 2,580* billion in assets held E: sebastien.danloy@socgen. and valuates 4,354* funds representing assets of EUR 405* billion (as com of June 2007). W: www.sg-securities-services. com With an extensive network that spans over 70 countries, well-positioned in the emerging trade and investment corridors across Asia, Africa and the Middle East, Standard Chartered’s Wholesale Banking business combines global capabilities with local expertise to develop innovative products and services to meet the diverse needs of our corporate and institutional clients in some of the world’s C: Giles Elliott, Global Head, most dynamic markets. Building on a rich banking heritage, Standard Chartered Securities Services is noted for a client-focused approach to business, unmatched on-the-ground P: +65 6517 0134 expertise and a solid track record of innovative, award-winning financial services E: [email protected] solutions, reflecting our continued commitment to power our clients’ ambitions. W: www.standardchartered.com As one of Asia’s leading custodians, Standard Chartered serves global, regional and local custodians and broker-dealers, as well as local and regional fund managers. The Bank plays a key role in promoting the development of these markets and keeping the international investor community informed of industry developments across the region.
Fund Administration
With more than 35 years’ industry experience, Capita Financial Group provides fund managers with fast and cost effective third-party administration services, enabling you to free up your day to focus on Leah Cox growing your funds and business. Our main focus is to provide a ‘Best +44 (0) 207 954 9559 in Class’ administration service, we work in partnership with you to [email protected] innovate, increase efficiency and provide the high level of customer www.capitafinancial.com. service that you and your clients expect. With our UK and offshore centres (Jersey, Guernsey, Ireland and Gibraltar), we offer a bespoke service to our clients and each area’s unique regulatory environment.
49 raw Directory ISJ47.indd 49 03/06/2010 20:13 Intesa Sanpaolo’s Transaction Services include : • Sub Custody, Derivatives and Remote Membership Clearing • Global Custody and Depository Bank for mutual funds, Piazza della Scala 6 pension funds, real estate funds, private equity funds and 20121 Milan, Italy hedge funds T: +39 02 8794 2466 • Fund Administration for mutual funds, pension funds, real F: +39 02 8794 1519 estate funds, private equity funds and hedge funds W: intesasanpaolo.com • Paying Agent for foreign funds and sicavs C: Riccardo Lamanna • Cash and Payment services like swift to checks, mass E: riccardo.lamanna@ payments, checks and cash letters intesasanpaolo.com
Société Générale Securities Services offers institutional investors, asset Sébastien Danloy managers and financial intermediaries a comprehensive range of Global Head of Sales financial securities services: Clearing, Liquidity Management, Custody Société Générale Securities and Trustee, Fund Administration, Asset Servicing, Fund Distribution Services Services and Issuer Services. SGSS currently ranks 3rd European T: +33 (0)1 41 42 98 65 custodian and 7th worldwide E: sebastien.danloy@socgen. custodian (Source: Globalcustody.net) with EUR 2,731* billion in assets com held and valuates 5,158* funds representing assets of EUR 499* billion W: www.sg-securities-services. (at end March 2008). com
Swiss Financial Services (Ireland) Ltd. Block 4B,Cleaboy Business Park, Old Kilmeaden Road, Waterford, Ireland T: +353 51 351180 UBS Global Asset Management- Fund Services Brunngässlein 12, PO Box CH-4002 Basel, Switzerland tel. +352-44-1010 1
Hedge Fund Administration
Apex Fund Services Ltd is a global hedge fund administration solution for hedge funds and private equity clients located in 12 C: Peter Hughes separate jurisdictions across the globe. The company uses the Group Managing Director software solution, PFS PAXUS, which is a fully integrated hedge fund T: +1 441-292-2739 accounting system combined with web-based reporting to allow F:+1 441-292-1884 clients and investors to access their information 24/7 securely online. E: [email protected] We will tailor all solutions to meet your needs and our continuing John Bohan focus on the quality of service and the relationship with each and Group Manager of Operations individual client ensures that we retain our ethos of providing a T: +353 21 4633366 personalized service rather than a generic solution. F: +353 21 4633377 Highly qualified and experienced staff, mirrored with top tier E: [email protected] technology and competitive fee structures make Apex Fund Services Ltd the clear choice for your fund administration needs.
Custom House Global Fund Services Ltd. (“CHGFS”), the Malta Custom House Global Fund based parent company of the Custom House Group of Companies Services Limited (“Custom House”), was established when Equity Trust’s fund services Head Office Address: division was merged into Custom House in September 2008. CHGFS Tigne Towers is recognised as a fund administrator and licensed under a Category Suite 33 4 license as a Custodian for Funds of Funds and is also an authorised Tigne Street Trustee for Trusts. Sliema 3172 Custom House offers a full 24/5, “round the world”, “round the Malta clock” administration service out of its offices in Amsterdam, Chicago, Dublin, Guernsey, Luxembourg, Malta and Singapore. This service, www.customhousegroup.com which enables Custom House to offer daily dealing NAVs covers all Contacts: Dermot S. L. Butler, aspects of day to day operations, including maintaining the fund’s Chairman books and records, carrying out the valuations, calculating the NAV dermot.butler@ and handling all subscriptions and redemptions, as well as over- customhousegroup.com seeing payment of the fund’s expenses. T: +353 1 878 0807 Custom House uses the PFS-PAXUS fully integrated fund Albert Cilia, Managing Director administration system. Reporting is effected through CHARIOT, albert.cilia@ Custom House’s secure web-reporting platform for managers and mt.customhousegroup.com investors. T: +356 2702 2799 Custom House is fully SAS70 compliant and the Dublin office was the only hedge fund administrator in the world ever to be awarded a Moody’s Management Quality Rating. CHGFS and its subsidiaries are fully regulated, as required, by the relevant authorities in their jurisdiction.
50 raw Directory ISJ47.indd 50 03/06/2010 20:13 EquiLend is a leading provider of trading services for the securities www.equilend.com finance industry. EquiLend facilitates straight-through processing by EquiLend Europe Ltd. using a common standards-based protocol and infrastructure, which 14 Devonshire Square automates formerly manual trading processes. Used by borrowers London, EC2M 4TE and lenders throughout the world, the EquiLend platform allows for +44 (0) 207 426 4426 greater efficiency and enables firms to scale their business globally. T: UK- +44 (0)20 7743 9510 Using EquiLend’s complete end-to-end services, including pre- and post-trade, reduces the risk of potential errors. The platform A: 17 State Street, 9th Floor eliminates the need to maintain costly point-to-point connections New York, NY, 10004 while allowing firms to drive down unit costs, allowing firms to expand T: US- +1 212 901 2224 business, move into different markets, increase trading volumes, all C: Michelle Lindenberger without additional spend. This makes the EquiLend platform a cost- E: michelle.lindenberger efficient choice for all institutions, regardless of size. @equilend.com W: www.equilend.com
eSecLending is a leading global securities lending agent servicing Contact: sophisticated institutional investors worldwide. The company’s Christopher Jaynes, Co-CEO approach has introduced investment management practices to the securities lending industry, offering beneficial owners an alternative Tel: US +1 617 204 4500 to the custodial lending model. Their philosophy is focused on providing clients with complete program customization, optimal Address: 175 Federal Street intrinsic returns, high touch client service and comprehensive risk 11th Floor management. Their process is to begin each client’s program with Boston, MA 02110, USA a competitive auction to determine the optimal route to market for their portfolios or asset classes whether it is via agency exclusives Tel: UK +44 (0) 20 7469 6000 or traditional agency lending. Address: 1st Floor, 10 King William This differentiated approach achieves best execution while Street, London, EC4N 7TW, UK delivering their clients with greater transparency and control, Email: [email protected] allowing them to more effectively monitor and mitigate risks. Web: www.eseclending.com Additional information about eSecLending is available on the company’s website, www.eseclending.com.
Finace is currently the only fully integrated solution which supports T: +41 (0)44 298 92 00 the future business model within the areas of Securities Lending, F: +41 (0)44 298 93 00 Repo and OTC Derivatives Collateral Management. The architecture A: COMIT AG, of Finace is based on a stable, leading edge technology platform, Pflanzschulstrasse 7, which was developed with performance and robustness as the focus CH-8004 Zürich, Switzerland of design. With flexibility at its core, customer-driven extensions W: www.finacesolution.com and modifications can be quickly and easily applied to the standard www.comit.ch component set.
Santander is the only Spanish financial institution with a team exclusively dedicated to securities finance & with the purchase of W: www.gruposantander.com Abbey in 2004 has expanded its capacity on a Global basis with T: (3491) 289 39 42/54 trading teams in London (UK) & Connecticut (USA). E: securitieslending@ Santander’s leading local capabilities in Spain, Portugal, UK, USA & gruposantander.com Latin America, along with its solid balance sheet & combined with the state-of-the-art technology, provides its clients with the broadest range of solutions in securities lending & financing, including availability across all assets classes, as well as access to uncommon emerging markets.
Eurex Selnaustrasse, 30, 8021 Zurich, Switzerland T: +41 58 854 2066 Euroclear Euroclear Belgium, Avenue de Schiphol 6, 1140 Brussels T: +32 (0)2 337 5111 Fortis Bank wNederland NV Rokin 55, 1012 KK Amsterdam, The Netherlands T: +31 20 527 1637 JP Morgan 60, Victoria Embankment, London EC4Y OJP T: +44 207 742 0256 SecFinex 60 Cannon Street London EC4N 6NPX T: +44 (0)20 7002 1003 SS&C Fund Services 80 Lamberton Road, Windsor, CT, 06095 T+1-800-234-0556 UBS Global Asset Management - Fund Services (Cayman) UBS House, 227 Elgin Avenue, PO Box 852 GT, Grand Cayman, KYI-1103 T: +1-345-914 1060
51 raw Directory ISJ47.indd 51 03/06/2010 20:13 Technology
Broadridge Financial Solutions, Inc., with over $2.1 billion in revenues in fiscal year 2009 and more than 40 years of experience, is a leading global provider of technology-based solutions to the financial services industry. Our systems and services include investor communication, securities processing, and clearing and outsourcing solutions. We offer advanced, For more information about integrated systems and services that are dependable, scalable and cost- Broadridge, please visit www. efficient. Our systems help reduce the need for clients to make significant broadridge.com. capital investments in operations infrastructure, thereby allowing them to increase their focus on core business activities.Proxy Edge - our comprehensive solution for institutional global proxy voting management. Gloss - our leading international STP system which automates the trade processing lifecycle from trade capture through confirmation, clearing agency reporting and settlement. Tarot - a UK retail and private client stockbroking, custody and fund management solution. Securities Data Management - outsourced data services for securities operations.
Eagle Investment Systems LLC is a global provider of financial Eagle Investment Systems LLC services technology serving the world’s leading financial institutions. The Bank of New York Mellon Eagle provides enterprise-wide, leading-edge technology and Financial Centre professional services for data management, investment accounting 160 Queen Victoria Street, and performance measurement. Eagle’s Web-based solutions London support the complex requirements of firms of any size including UNITED KINGDOM institutional investment managers, mutual funds, hedge funds, EC4V 4LA brokers, public funds, plan sponsors and insurance companies. Phone Number: 44 (0)20 7163 Eagle’s product suite is offered as an installed application or can be 5700 hosted via Eagle ACCESSSM, Eagle’s ASP offering. Eagle Investment E: [email protected] Systems LLC is a subsidiary of The Bank of New York Mellon W: www.eagleinvsys.com Corporation. To learn more about Eagle’s solutions, contact sales@ eagleinvsys.com or visit www.eagleinvsys.com.
Financial Tradeware provides integrated solutions for medium to small sized Investment Management firms, Fund Managers and Hedge Funds, covering the full trade life cycle. It is part of the Dharma Group W: www.f-tradeware.com of companies and benefits from the joint contributions and experiences T: +44 (0)20 7493 2773 within the group of market traders, business analysts, financial services F: +44 (0)20 7495 4858 professionals and skilled Microsoft Certified programmers. The company C: Graham Bright has developed a suite of applications that integrate and Straight Through E: [email protected] Process (STP) real-time trading, back office administration, accounting A: 31 Dover Street and compliance. Ultra.net®, S-Messenger® and H-Fund® arwe the London W1S 4ND UK company’s flagship products all based on Microsoft.NET infrastructure. The company also offers a Member Concentrator for hosted SWIFT connectivity and Member Administered Closed User Group (MA-CUG) services for Corporates and Hedge funds.
Fidelity ActionsXchange is the leading provider of flexible, technology- driven global corporate actions information solutions for many of the world’s financial industry leaders. Through our two products, C: Gil Isenstein ActionService and ActionCompare, we provide multi-sourced, Senior Manager cleansed data and complementary event information which is Fidelity Investments validated, enhanced and enriched by a team of in-house analysts. By leveraging more than 10 years of analytical expertise, technology A: 82 Devonshire Street, W4A and service, we offer solutions that source, enhance, compare and Boston, MA 02109 validate corporate action announcements, turning even the most E: [email protected] complex data into valuable intelligence. Our strategic value allows T: 617-563-6764 clients to reduce costs, mitigate risk, gain efficiencies and enhance transparency giving them the highest degree of control over their global event information.
Information Mosaic is a trusted global provider of advanced post-trade automation solutions to the securities industry, to include custody, asset servicing, private wealth, asset management and investment banking. For more information on Information The company is a recognized market leader for corporate actions Mosaic, please visit our website at automation, winning the 2009 European Banking Technology Readers’ www.informationmosaic.com Choice Award for best corporate actions solution and achieving record scores in B.I.S.S. 2009 corporate actions benchmark tests. US: Founded in 1997, Information Mosaic currently supports the post-trade [email protected] operations of over 60 financial institutions worldwide. The company has a proven track record of helping financial institutions transform Europe: post-trade operations, enabling them to enter new markets, improve [email protected] customer service and reduce the risk and cost associated with volume and complex processing. Information Mosaic’s breakless post-trade Asia: automation platform removes reconciliation points and therefore reduces [email protected] risk and cost for all core post-trade services including corporate actions, securities settlement, trade, portfolio and cash management. The company supports its global customer base from offices in Dublin, London, Luxembourg, New Delhi, Singapore, Melbourne and New York.
52 raw Directory ISJ47.indd 52 03/06/2010 20:13 Isis Financial Systems provides mission critical investment management software and services to many large and small companies. Our customers perform a broad range of accounting and management functions covering various industries including the fund, Isis Financial Systems hedge fund, wealth management, and pension and endowments, 14 Felton Street etc…. Our integrated solution services span from the back office to Waltham, MA 02453 the middle. Even some front office operations are available. IMS E: [email protected] is built on a contemporary three tiered architecture. Our services T: (00-1) 781-209-0262 help financial companies improve operating efficiencies, increase accuracy and reliability and improve customer service. IsisFS has the experience and IMS is the platform to improve your operations and save you money. KOGER is a leading provider of technology solutions to the fund administration industry. KOGER products are used by some of the largest and most respected institutions in the industry. KOGER has offices in each of the USA, Ireland, Slovakia and Australia and provides comprehensive 24/5 technical support. C: Mr Ras Sipko NTAS (New Generation Transfer Agency System) is the premier T: +1-201-291-7747 shareholder register and transfer agency system in the market. NTAS E: [email protected] modules include an extensive range of incentive fee calculation W: http://www.kogerusa.com methods as well as an extensive list of capabilities such as dividend processing, cash flow management, anti-money laundering, blacklist, taxation and fee management. NTAS supports a wide variety of fund structures including master-feeder, fund of funds, series, limited partnerships, private equity and side pockets. Reports are fully customizable and worldwide replication is available. KOGER’s GRID (Global Reach Interface Daemon) is a middleware interface that integrates NTAS with any third-party system.
Misys provides integrated, comprehensive solutions that deliver significant results to over 1,200 financial institutions globally. Our buyside solutions help asset servicers, asset managers and hedge funds handle the latest complex products, streamline processes, C: Suzanne McLaughlin reduce costs and improve STP. Misys Summit is our award winning, T: +44 (0)20 3320 5000 multi-asset class solution that boasts 18 years OTC derivatives E: [email protected] market expertise. With extensive OTC buyside coverage and the W: www.misys.com market leading structured products module, Misys Summit delivers the solution you need for handling the end to end process for OTC. We also provide a customisable ASP service for fast implementation and lower costs. Misys provides integrated, comprehensive solutions that deliver significant results to over 1,200 financial institutions globally.
Building on over twenty years of experience in capital markets and cross-asset software solutions, Murex introduces Mx Asset Manager - a unique cross currency, cross asset fund management solution capable of handling the full range of products, from plain C: Hélène Desbiez vanilla to the most complex derivative products. Coupled with a high Business Development Manager degree of flexibility and customization, Mx Asset Manager features a T: +33 1 44 05 32 00 multifaceted design catering to the needs of both service providers (prime brokers, administrators, asset servicing providers) and direct E: [email protected] clients (portfolio managers for mutual, pension or hedge funds, insurance companies). With so many new challenges presented to W: www.murex.com buy-side managers when integrating increasingly-complex derivatives into their portfolios and funds, Mx Asset Manager represents a strong and reliable ally for dynamic position keeping and multi-dimensional risk management in a thriving market.
peterevans is a leading independent provider of front to back office solutions for the financial services sector. Clearly focused on the securities and investment market, and building on over 24 years A: peterevans experience of providing award winning solutions to this sector, peterevans New Broad Street House presents a sophisticated boutique approach in a homogenised market 35 New Broad Street place. With xanite our new suite of applications we can help ensure that London EC2M 1NH you deliver extraordinary products and services to your customers. The peterevans xanite suite offers a configurable, fully integrated, T: +44 (0)29 20402200 browser based, comprehensive front to back solution that can be either deployed as a single application or integrated as components into your E: [email protected] existing platform. xanite has been designed for today’s market, and provides Multi-entity, W: http://www.peterevans.com Multi- currency, and Multi-language support. User access to the system is configurable allowing each user’s experience of the system to be tailored to suit their specific needs. Each of the xanite modules can de delivered via an ASP or self-hosted. The xanite suite of products supports the following business areas: wealth management, custody, corporate actions, clearing and settlement, private client and on-line stock broking, peterevans gives full but controlled access to clients, portfolio, fund and relationship managers, brokers, middle and back office staff – on line anywhere and everywhere.
53 raw Directory ISJ47.indd 53 03/06/2010 20:13 Pirum provides a full suite of automated reconciliation and straight through processing (STP) services supporting Operations within the global securities finance industry. The company’s on-line SBLREX T: +44 20 7220 0961 service encompasses daily contract compare, monthly billing F: +44 20 7220 0977 comparison, mark-to-market & exposure processing, pending trade C: Rupert Perry comparison, income claims processing and custody reconciliation. E: [email protected] Subscribers to Pirum’s services significantly increase their A: Pirum Systems Limited operational efficiency and reduce their risk by using Pirum’s solutions, 37-39 Lime Street as staff are able to focus on fixing the exceptions instead of using London, EC3M 7AY W: www.pirum.com their time to check and process routine business. These automated processes are more scalable and risk controlled too, allowing significantly higher volumes to be managed without corresponding increases in operations headcount.
SimCorp Dimension is designed to enable institutions which manage or service investment portfolios to mitigate risk, reduce costs and T: +44 (0)20 7260 1900 position themselves for growth. F: +44 (0)20 7260 1911 It is a comprehensive, truly seamless system supporting front, C: Elizabeth Gee, sales middle and back office functions as required. It handles NAV and other director calculations, with full related accounting, for a huge variety of fund of SimCorp Dimension structures and product types, including regional specialities. E: [email protected] SimCorp Dimension was designed from scratch as an enterprise- W: www.simcorpdimension. wide system, so it handles all aspects of the investment management com process and related administration functions, consistently. Data is A: SimCorp, 100 Wood Street, recorded once into a core database so that reporting is made easy, London EC2V 7AN there is no need for internal reconciliation of data, no duplication of procedures and integration with external systems is particularly straightforward.
SunGard’s solutions for data management provide technology for the management and delivery of market, historical and reference data to financial services institutions, energy and public sector organizations. 888 Seventh Avenue SunGard also offers outsourced data management services, as New York 10106, US well as real-time, interactive and flat-file data feeds for application T: +1 888 441 9935 integration. Aggregating market data and financial content from E: [email protected] more than 100 third-party sources, SunGard’s solutions for data W: http://www.sungard.com management add value through a range of services including cleansing, enrichment and analytics. To find out how SunGard’s solutions for data management can help improve productivity, portfolio optimization and investment opportunity with predictive analytics and packaged data please visit our web site.
Advent Software 1 Bedford Avenue, London, WC1B 3AU, UK T: 0207 631 9240 Accuity Market House 124 Middleessex Street Bishopsgate London E1 7HY T: +44 20 7014 3454 Aquin Components GmbH Moosmatthalde 4, Meggen, CH-6045, Switzerland T: +41 44 455 62 44 BI-SAM 1 Cornhill, London EC3V 3ND T: +44 (0)20 3008 5834 Bravura Solutions Austin Friars House 2-6 Austin Friars London EC2N 2HD, UK T: 020 7997 3000 Calypso Technology 17 Dominion Street, London, EC2M 2EF, UK T: 020 7826 2500 DST International DST House, St Mark’s Hill, Surbiton, Surrey, KT6 4QD T: +44 (0)20 8390 5000 Princeton Financial Systems 600 College Road East, Princeton, NJ 08540, USA T: +1 609-987-2400 Redi2 Technologies, Inc, 1771 Broadway St., Oakland, CA 94612 T: +1 (510) 834-7334 SmartStream Technologies 1690 Park Avenue Aztec West Almondsbury Bristol BS32 4RA UK T: +44 (0)20 8390 5000
Witholding Tax
T: +44 (0) 208 760 7130 Goal is widely-acknowledged in the financial services sector for C: Stephen Everard or its innovative and creative solutions to highly-specialized niche Saghar Bigwood processes. A: 7th Floor, 69 Park Lane, Goal’s research has shown that in excess of USD8 billion of Croydon, Surrey, CR9 1BG withholding tax remains unclaimed each year by the rightful owners E: [email protected] or and beneficiaries and that over USD12 billion is lost because rightful [email protected] or beneficiaries are not participating in class actions, bankruptcies and [email protected] disgorgements. W: www.goalgroup.com
54 raw Directory ISJ47.indd 54 03/06/2010 20:13 EUROPEANCUSTODY
Show me the Light
European Custody Landscape Germany , Southern Europe, Central & Eastern Europe, Nordic
Spotlight on: Cyprus - Private Equity & Hedge Fund Services
EUROPEANCUSTODY
European Custody Landscape Germany 2 Southern Europe 4 Editor Brian Bollen Central & Eastern Europe 8 [email protected] Nordic Region 16 Advisory Board Chairman Clive Gande clive.gandeISJ.tv Senior correspondent Spotlight on: Cyprus for private Craig McGlashan [email protected] equity and hedge funds 12 US correspondent John Sandman [email protected] ! ! $ * - + " $ "# $ % & '-.'"( % Special correspondents '# " Cherry Reynard Anthony Harrington Head of sales Patricia De La Grange [email protected]
Account managers Cicely Lewis [email protected] Eradat Munshi [email protected] CTO Peter Ainsworth [email protected] Operations manager Nicolette Whittaker [email protected] Editor-in-Chief Roy Zimmerhansl ! *! " [email protected] + " $ , " )# $ Managing director * (' Jon Hewson [email protected] Publisher Mark Latham [email protected]
2i UK One Angel Wharf, 59 Eagle Wharf Road London, N1 7ER, UK T: +44 (0) 20 7183 7470 F: +44 (0) 20 7250 0350
2i US 410 Park Avenue, 15th Floor, New York, NY 10022 T: +1 212 231 8421 F: +1 212 231 8121
© 2010 2i Media All rights reserved. No part of this publication may be reproduced, in whole or in part, % " " $ without prior written permission from # '"( )# the publishers. ISSN 1744-151X $ '# % & * ( 1 * (
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
3 ' '
'! ( *#
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ordea Bank
Custody services with a broader horizon
Are you looking for a single point of entry to the Nordic and Baltic region? Or do you have your eyes set on a specific local market? Nordea is the leading Nordic custodian and the only truly Nordic player with well-established banks in Finland, Denmark, Sweden and Norway as well as a strong presence in the Baltic countries.
A dedicated relationship manager supported by a specialist team will always be able to offer you a winning combination of regional competence and local insight. Our size, experience and connections with key players make us a sustainable provider in the evolving Nordic and Baltic securities markets.
To capitalise on our expertise, please contact Ms. Anne-Lise Kristiansen, tel +47 2248 6238, email: [email protected], Ms. Nina Groth, tel +45 3333 6124, email: [email protected] or Mr. Teemu Pihlatie, tel +358 9 165 51008, email: [email protected].
nordea.com Making it possible %" "# 5$ $ $" (" + %5 * 5&" & ( !! $ ("E $" ! ++ ! $ +++" ;"& ($ " &"& $" +%" "+"5 $ $ " "% (( " $" "% " %"# + ""% $" "% "" $" % ( $ !" B ("; ' $ &%!"%+" 5 $ (( " && &$ + $: (O-"> " #$ " " ("; 5" $ & %%"+ 4 ,' # + &"7:8 + ; % ( " ( $ C & ( # 1C 945 # B ("; % ( " $ & +£ $ &$ \ "% ;" $ & ( £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£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
+ &"+ "% (=$ ,$ < 4(& #4(& I$ $"("; +$" ! ("; &$ "%( " "% $$" E "5" ( (("" %(( ( 5" %" >: " &%: "@"+ "% ( E " % &$ " & " 5$ % &$ $ $ +" "% $ " $ %! & 5 & $ $ "%" " $" (" "5 5$$ !% C% $# % "; + 5 %% "! &$ > $ > " & ( , " # " # ( ! !" ] =$"" $ ("; "%" " $" " : 5 $$ $ &$ (! % % "( " $ ' & J5 %% %9U<=$"" $ &% $(& (" K#% ("; $ £ +% #5$$" ! % "] + " "%% #$(& #5$ $ + \ "%% " ; & $"! " " % + "$ =" $"; ! $" " %"& +" ( " ( $ & % &$% 5$"$ 5 ++ ! ] & (< " 5 # #" $ 2 C $* K 5 % " ( E ("; ! ',5$ && !" ; 9"! "%( $ 5 # % " %# &" % " " ! & 5("K % K & $ 5" 5 $" " " !" ; "% &$"$ " ( ; (" + " #" (5 &"! 5$ $ "5 5 %% + +I$ (( " % " ; $ %$ ! "%%5 $" " $"$ + +% 4 &" " ( % % % ; $$ &$
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
(' . - $ ) 8'( " "! $' "
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£\" $" ! \ & \ "% %% :] & + " $ %"= $"++ %" ($ £ " "%+% "$ \" "% "++@ (" % ( %% # + ( $%"& $" $ " &5 & $ + ( $ $ \" "% , ( "#$ " !! "#$ " (+" $" ! \ (" $" % %" #$ % 2"#2"%"K @ (! &" ! " " # "(% + #%5 " $" "%"& (! "% + "% " " %"!% (+% " #""( (+% ( " 5; $ \" "% M %%+ !% "" " & ( "% & %" $ E % #5 $ $" & "%5 $$ %" ! " " ? " $ $" @ ( (" "( (+% @\" "% + ! ( &" " $ $ & (""& ($ )O ; & 5% " $ $ & ! ! " & " (! " & %" #] @ ! % " "8 "++ "% ( "@N + :( % $ & (""& ( (+" K "% & %" $" $5$"$ " ( E "8 "++ +" "@$" " ! $"" +" +" $ ("; (+% 5 $ % ( " % " " + (""& ( " & %" ! ( " "+"&(" ! : % $ (+" " " ( + N % " 5 $"] @ ! % $" "( % " ") 4 & "( " "!" ; \ ! \ E + % %"K @ (! & ("] @ !% & %" "++" $"%5+ " & $ &$" +$ & %" $" , ( " (+" $ (" $ & $ " !! "E I$ " "! + K ! % " " % "!% + "% $ & 12 Supported by
Tap into the brains of your industry colleagues.
The Benche is a web community for professionals within trade finance, cash management and custody. Its purpose is to encourage sharing of knowledge and experience, open discussions and networking. Join us at www.theBenche.com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£ (" \" "% + $ + ! $ "!% C "% " $ $ &"% I$ " " % " ! + K ++ " " %"!% (" (! "!% $ % &"%" & %" "( 5;$"" "%% #" "( " #%"5\( #" "!"; (+"" ""& + K (""& ( $" %" % ] @ !% "B ; +" + ( ( $ " (" " ( " " +%" I$ + ( ( #$ "++% " "% " " @ & (""& ( \( 5$ $ ! $ + "@ $"& \" "% !" $ " $ " + " (( / 0#+ $ % &"% "( 5; + $ !" +" + &K" @ &% $ + ( " 5 %%" $ ("$ )E & " # & %" + " " + =$ % + $" """ @+ " + ( \( / 0 +$ " + "% # "% % @+ $" $ (" % " J+ " "% + ) $ + $ #$ %%5 &+ "% " ( %"$ $ " (" % , $- & (" + ( %" #! %5 $", ( "" " % % $" # N ( \( + " &5 $ + # $ $" % %" #? !% K @ (! &$ @ % & #+ $"$ $" ( % (" #(" & ( " "& &5$" ! "++ ! $ N $ + " "@$" K#5$ $ %! "("E # "!% $ + #+ $" " ""& 5$( % 5"\""@: $ $" "" $ " ! $ "%,"; \ 5" (""& &$ ( + N $ " ""& + $""%$ &$ $" %5 # ( \( 5 $$ & \ "@" /> "@&" ( " &0#" " + 5$ $ + & ( : ( (! $ > % % ; % ! " $ &$"!" $+ " &" : ! &" "@$" " I$ ("; """ ! !" 5 $ "!" $#+ $ $" ! +%" $ # + "%% &$ &" "% ("$ )( (! " K @ %% " "% %" 5 $$ 2 % " "$ ((5 "%$ + " I$ & $ + " $ %%5 & ( &)+ # * + "" ( #! $"% # 999"$ +" "& % & %" # ( \" "% ( N " (" 5 $ $ + # C+ " "% & \" "% ( N \" "% % " " + "% # 2""& & ( + % " " 5 $ + " B " +" %"% 5 %% " #! ("" & ! 5$ $+ % "%% + # % & $ % B "% $ % \" "% ( N K @ (! & - # ") "; & # ) 5 & + \" "% ( %% ( I" "!% /)I 0 " $ " \ $ N " " " %"!% + " & %" ! $ "% # " ; + &""( " %" \" "% ,"; + I$ " "% + ( N $" "! & + # " $ # " N # '" & %" % "!% $ ( " " " \" "% ( #5$ " "%%% ( $ ( "! + $ \(&" &$ %" % $ " (! % &"% " " N # " "!% "+ "% ( (+" / - # "; & "+ "% # "% B "% 0N " & " %" (" "" " # \@ "+ "% ( (+" / B "% 0N %" &( & "" B N # N # 5 &N # % ( +" $ + # ( " &\" "% ( N # & @ $"& 5$ $ " L:)I + " & + "%% "; 5 $ ( 14 $ " # 45I' I"@"( 5; I"@" J %% $ ( I$ + !" "" $ " %%5 "5 I$ + "@%"5 " & ++$ "++% " $ $" % #"(& $ %+( $ " " " "%\" "%" % &"% ( #"! +%" " % &$ + + " ! & " "% (+ $ (+" "%&5 $$ C( " "% ( N " ( " $ + $ % &"% " $ ++" % $ %+( \" "% N + ( "%" $5 %" % " C " " %" " "%"@ " @ & (""& ( \(\" "% +" +K" @ &% ("$ ) I$ (" "@+ $ + "@%"5 " E # " !E " \ +" "@ 8N # I" &+\ &" ($ + "% " K &"%" & %" "( 5; "@: @ (+N J $ +" " # + K% &"% ($" "% # ? ( ( " ( "@: % + " +$ " " (+ $ % &"% @ (+N "( 5;!" )O%"5" & "" & # L5 $$% &"@+" ( # "$ (+" & "+ " ( " "% : N + $ %%5 &+ +% # "+ "%&" "% (( "!% ++ $ % " " ( \" "% + / $" (+" 5 & & %" "+ " (+ $ "( 5; ++ 0" $ + "+ "%&" "@ $ & +#% &"("; & "%% + 2 # + $" "5 "! \ "%? !% :I"@ %% ( $ ( " "% " I " /?II0L 5;I$ " % ?II + ( N "9$ ! & & " I$ @ $ $" +" ( !"; &%"5 5$ $ ( " # (! 5 $$ %5 "%%"@ & ( # $ ! +" )!"; & & %" " & \ "+ ! % " "%"@+%" &$ &$ + B ( "+ "" B " $ %"!$ +" " "%% % % % & %" :!"; &\" "%" N "%%5 $ & +" & "$" C +% Z "% J K ! &$ + (+" %"5 % 5 $) (+" + % % &" "\" "% #! %"5 #+" %"% ! + & % " % ( & # "% " $" $ & +%" ("; " @ %% "$ % \" "% " ( #$ "% " !" $ & ! "+ +% & %" !" $ "$ (" N I$ " " " #5 $"%"& "% "+ )"J? "" + +% @+ + "% "%5 $ & + + "$ + ( %" &" ""( & 5 $B "% ""%5 "% &5 $ " "% %% & ) /)0 I$ %""% !" $ $ &$ (! " " " &" $ ) (!" &2 K" & $ 5%"+ "+ "!" 5 $(" " "% /2JO 0N (+" $" &"+ $ #" 5 %%" $ ! & % " $ " + + %"5 + &" &#" &" % & + "% 5$ $+ $ " " $ + K $ &$ "" $" + " " & 5 $ $ &$ 5" $ \ $ 5%! "++ ! $ + \ "%" & %" (+% " " $" " &%"1="% 5 $ ! & &" \" "% ( " B "% $" " " % "%% I$ " & ( %" &" "% & & &"+$ "%% " $ %"#"$ " $ ""$ ! + # " % " I$ C J 2 K" & +" $ + " " $ + &!" ( I$ %"5 $ + ( %" & \ $ "(& + # "" "I$ K % " ( ( %" &"%&$ % "+ $ $ $" ! $ ! " )"("; " ( "% + % "%%("E + # "#$ 2 % " "$ (+% ( ( ( I$ (" "% "" I$ K 5 " "%" + ! (( ! $ 5$" "! ( %" & # $ % ] &$ + 5 ; ! " "% I$ + " $ "+ " 5 $ $ " % " 5 %%" ! " % + " " +" E \" "% " !% & +" ( + " %" &5$ $ ( $ ;5% & $ +% ? " % & %" & $ \" "%+ " $ ; &% ; "$% " ! $ # $ ;5" % #; +++ " (""& ( \( "+ +% ; &B "% + + " " $ " $ I$ $ ! #$ %5 )+ "%" +" " $ + !% $" & % %"!" & "@ (! 5 $"& "% % # " @+%" &$ % &"% B ( $ &" $ + "% ( $" ! \ $ + % $ $ " $ + "# @ %% & % ! 2JO % (( " " " ! "$"; &" "%! " #("; & K $ ( % "!% \" "% \ $ ) \ ! " & % ' & " #OC2' + # $ "& & " [;+(& ( 15 "# !
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£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n Conversation With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how me the Light
: ' $ " "#' $' $#' ! )CCJ*I?,M ' '"(7 ! 3337:7)>' #'"(
EUROPEANCUSTODYSUMMIT C* LI?,M #' $' " & $#' '"( " )# ! ' Investor Services ISJ Journal :' ( <= . 0 "
0 " ' ) - # # 7" ! !?@7) 18