MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Monday, August 7, 2000 Merrill Sends Accounting to State Street The demarcation line between asset management and the nitty-gritty of back office work is being drawn more starkly. Today, Merrill Lynch, one of the largest fund sponsors with more than 227 products and $200 billion in assets said that it is placing its domestic fund accounting unit into the hands of State Street Corporation. The deal includes the transfer of Merrill Lynch Investment Managers' fund accounting center in Princeton, New Jersey to State Street. Approximately 300 of Merrill's employees working in the center will also be moved to State Street. The firms said that they expect to complete the transition by year-end. State Street will be assuming the lease on Merrill's 500 College Road East facility, said a spokesperson for Merrill Lynch. The processing and employees will continue to be performed in that center. State Street plans to keep the facility operating and possibly even expand it. A spokesperson for State Street said that the firm will potentially service other clients' business from that office "sometime down the road". The management team running the facility will report to Michael Williams, executive vice president at State Street in Boston. However, who will run the facility on a day-to-day basis in Princeton has not yet been determined, according to a State Street spokesperson. Under the arrangement, State Street will assume all fund accounting and daily pricing services for Merrill Lynch's US retail mutual funds. It will be responsible for calculating 620 net asset values for these funds on a daily basis. Not effected by the deal are Merrill's non-U.S. funds. Prior to gaining Merrill's business, State Street's claimed more than $1.4 trillion in assets serviced in the $7 trillion industry. The spokesperson confirmed that this is the new business win of this type for State Street. "As a leader in the increasingly competitive investment arena, we are pleased to be among the first to outsource our fund-accounting operations at this level," said Terry Glenn, Chairman of Merrill Lynch Investment Managers (Americas). "This strategic alliance will not only help us control operating costs, it will enable us to focus on our core business of asset management and continue to provide superior service to our clients. Our longstanding relationship with State Street and the company's superb track record in providing fund services were instrumental in our decision to ask them to provide this total outsourcing solution." State Street has provided global custodial services to Merrill Lynch since 1974, according to Ronald E. Logue, vice chairman and chief operating officer of State Street Corporation. "We are pleased to have the opportunity to significantly expand our relationship with a world class institution like Merrill Lynch, said Logue. He added that, "The surge in trade volumes and cross-border investments, along with the industry's decimalization and T+1 initiatives, are creating unprecedented demand for a total investment fund servicing solution. State Street's unparalleled ability to provide a complete range of investment services at scale to asset managers across the globe uniquely positions us to meet this growing market demand." Printed from: MFWire.com/story.asp?s=26105 Copyright 2000, InvestmentWires, Inc. All Rights Reserved |