Since the emergence of “Modern Portfolio Theory” and the “Capital Asset Pricing Model” in the late 1960s, institutional investors have taken a quantitatively driven approach to portfolio construction, looking to create portfolio diversification and obtain better risk-adjusted returns by balancing their asset-class exposures. This journey has seen several important advancements in thinking about how to optimally achieve desired results.
Funds that want to take the total portfolio approach first need to get the total portfolio view. To do that they not only need data – and lots of it – but a rock-solid understanding of exactly how they’re going to use it.
ANZ fund admin outed as big back-office prize
ANZ is the last of the big bank-owned investment operations in NZ to retain almost full in-house control of funds administration including registry, accounting and custody. But the bank is poised to put the back-office duties in play, according to industry sources, bringing it into line with competitors in the sector.
Last year ASB joined fellow Australian banks Westpac and BNZ in outsourcing most back-office services after inking a custody and admin deal with BNP Paribas Securities Services NZ. BNZ and Westpac have long used external providers including Trustees Executors and Apex (formerly MMC) for various fund administration services.
Aside from ANZ, only AMP and Booster among the large KiwiSaver providers do most administration in-house. The $7 billion plus Kiwi Wealth, now owned by Fisher Funds, only recently switched off a long-running in-house admin system after outsourcing to BNP Paribas and Apex (MMC). However, it is understood the Kiwi Wealth business will ultimately switch to Fisher admin provider, Trustees Executors.
Currently, ANZ, which is the largest retail fund manager in NZ with three KiwiSaver schemes under tow among other investment products, performs all admin and local custody internally with JP Morgan acting as global custodian.
A spokesperson for the bank said: “ANZ partners with a number of suppliers across our New Zealand business, including those with specialised investment management expertise. We are always looking for opportunities to evolve or improve our business however we don’t comment publicly on commercial partnerships.”
The ANZ funds management team, headed by Fiona Mackenzie (pictured), has also seen several senior departures over the last few months including Alan Clarke, co-head of diversified portfolio management, and Australasian equities chief, Craig Brown.
