Following a tense review process the $7 billion plus Fisher Funds has retained Trustee Executors (TE) for back-office duties – albeit with further wrinkles in the deal to iron out.
It is understood TE – which stood to lose its biggest fund accounting and custody client after Fisher put the services out to tender earlier this year – has a three-month window to update its technology in line with requirements.
In September, Bruce McLachlan, Fisher Funds chief, confirmed the manager had tendered the back-office services with long-time incumbent, TE, set to sweat it out with competitors BNP Paribas and MMC also understood to be in the frame.
At the time, McLachlan said: “This process has not been driven by any dissatisfaction with TE. We have an obligation to our clients that these services are the best available and for good value and we have not gone to market for some time.”
Early last year Fisher appointed TE as registrar across its fund suite in a role previously split with Mercer. Fisher inherited the Mercer admin service through its almost $80 million purchase of Tower Investments in 2013.
Jody Kaye, who joined Fisher as CFO from Harbour Asset Management in July 2016, was not able to confirm TE had secured the fund accounting and custody contract.
However, Kaye said the Fisher board had “approved a party” to engage in final talks.
“The board is putting together a contract that will be approved subject to successful negotiations,” he said.
As Fisher and TE enter final phase negotiations, however, it is understood a number of other NZ fund admin contracts are changing hands.
Last week, for example, Nikko confirmed MMC as registry provider for its updated range of funds.
Fund admin is a hotly-contested market globally with cost pressures and improved functionality offered by new technology sparking manager reviews.
According to Global Custodian, the fund admin sector itself has seen consolidation of late with Deutsche Bank recently selling its back office business, joining the likes of “Citi, Credit Suisse, UBS and Wells Fargo”.
“Currently, banks that have a larger asset servicing business such as BNY Mellon, Northern Trust, State Street, MUFG, and BNP Paribas Securities Services remain the dominant bank-owned players,” Global Custodian says.
In Australia, too, the fund admin game has been active with providers Mainstream BPO and Link (which has a NZ arm) in acquisitive moods.