Bank of New York Mellon is launching a new administration platform for private equity fund with a view to becoming a top five player within the next two to five years.
Bank of New York Mellon is launching a new administration platform for private equity fund with a view to becoming a top five player within the next two to five years. In the last year, despite the economic downturn, the bank’s private equity assets under administration have increased by more than 350 per cent from USD2bn to USD7bn.
The new platform will offer a full suite of outsourcing services that BNY Mellon says address the need in the sector for better compliance, internal controls and accuracy. The bank’s investment in the private equity servicing business follows its acquisition of the fund of hedge funds administration business of Dallas-based Lamp Technologies in May.
The integrated services offered by BNY Mellon’s alternative investment services business through a dedicated team of professionals based in Ireland, the UK, US and Hong Kong, are designed to support a broad range of private equity investment segments including buyouts, venture capital, mezzanine financing, real estate and hybrid hedge fund deals.
The bank says an advanced technology platform will deliver reporting capabilities through a secure web-based portal, from fund set-up to capital calls, distributions and portfolio monitoring, including account balances and performance.
With global private equity assets forecast to grow from approximately USD2trn today to USD5trn by 2015, studies suggest that less than 15 per cent of US private equity firms currently outsource their fund administration operations.
‘Recent market events and increased reporting requirements from institutional investors are compelling private equity firms to reassess their back office operations from a cost-effectiveness standpoint,’ says Brian Ruane, executive vice-president and head of financial institutions client management at BNY Mellon.
‘By expanding our suite of services, from accounting and administration to custody and cash management, and adding industry-leading information delivery, we can provide a total package that enables private equity fund managers to maintain their investment focus while we support fund operations.’
Rick Stanley, head of product management for alternative investment services business, adds: ‘We continue to invest in technology in the areas where our clients are seeing growth and coming to us for solutions.
‘With this, our second major product initiative this year, we listened to our private equity clients, who told us they’re increasingly more likely to outsource fund administration. We’re ideally positioned to meet this need by integrating our company-wide expertise.’
BNY Mellon is a leading hedge fund administrator with more than USD200bn in assets under administration and a global presence comprising offices in Bermuda, the Cayman Islands, Hong Kong, Ireland, Luxembourg, Singapore and the US, as well as US offices in California, Florida, Massachusetts, New Jersey, New York, Pennsylvania and Texas.
In addition to hedge fund administration, the company offers accounting, cash management, collateral management, custody, corporate trust, asset management and wealth management services to the hedge fund industry.
