Public Trust has set a June 30 target for switching on its new Microsoft-friendly custody system.
Part of a drawn-out technological upgrade dating back to 2012, the Public Trust custody revamp comes courtesy of the NavOne software – built by the UK-headquartered Touchstone Group on a Microsoft platform.
The government-owned trustee and financial services business awarded NavOne the lucrative contract to modernise its antiquated IT infrastructure across the board following a 2013 tender process. Costing more than $26 million – a figure that sparked questions in parliament – Public Trust finally went live with NavOne late in 2016 after a series of delays.
A 2017 Commerce Committee report on Public Trust says: “We will continue to monitor the implementation and costs of NavOne with interest.”
In a note to clients, Public Trust says it decided to extend the NavOne service to custody in the wake of “client feedback”.
“We listened to our clients who want Public Trust, as New Zealand’s only Crown owned and AA rated custodian, to have a fit for purpose custody system,” the note says.
“… [Navone] will allow our team to provide clients with an even more robust and efficient core service. Its implementation will automate our operations internally and to the market, allowing for more timely and accurate processing and reporting for our clients.”
Public Trust is currently the only NZ firm using the Touchstone NavOne software. In September 2016 Touchstone hired former Public Trust business analyst, Yvonne Faulkner, as its NZ representative.
It is understood former JP Morgan NZ head, Mark Lawrence, is working with Public Trust on the custody transition.
“The project is well underway with completion expected by the end of June 2019,” Public Trust says.
While Public Trust provides custodial services on local assets it outsources global custody to BNP Paribas.
According to the latest Public Trust annual report, the business supervises almost $86 billion, including about $16.7 billion on behalf of eight KiwiSaver providers. As at June 30 last year the group also reported assets under management of $2.7 billion and funds under management of almost of $1 billion (split between the $361 million government-guaranteed Common Fund and the $625 million Public Trust Investment Service – or PTIS).
As well as offering a range of five diversified investment funds, the PTIS includes a portfolio service (built on the NZX Wealth Technologies platform) for wholesale trusts with over $1 million to invest. Vanguard manages the diversified funds global and Australian share portfolios while all other asset classes are managed in-house by Public Trust to an index strategy.
Similarly, Vanguard is the international equities manager for the platform service and Public Trust handles all other assets internally, including Australasian shares. The Public Trust investment platform also holds a range of alternative asset funds, now closed to new investors.
Until 2016 Public Trust used the Colonial First State Global Asset Management ‘smart beta’ subsidiary, RealIndex, for offshore equities. Public Trust closed its retail fund suite in 2014, ahead of the-then impending Financial Markets Conduct Act (FMC) regime.
Over the 12 months to June 30 last year, Public Trust recorded a net profit of $3.1 million – about $2 million under budget and $10 million down on the previous 12-month period. Last week the group also named Glenys Talivai as CEO to replace incumbent Bob Smith in March.