BISYS announces new fixed income capabilities on SMA platform
BISYS has introduced an enhanced version of its WealthSolutions SMA platform featuring robust fixed income processing technology.
A traditionally restricted offering in SMA portfolios because of their inherent processing complexities, direct investments in fixed income securities now represent over 75% of the approximately 5,000 accounts and USD 2 billion in assets serviced by BISYS Fund Services on its WealthSolutions platform.
The added fixed income capabilities within BISYS' WealthSolutions
offering help SMA managers to:
- Manage the differentiating features of complex securities such as mortgage- and asset-backed securities, 'To Be Announced' mortgage-backed instruments, and collateralized mortgage obligations, giving managers a wider universe of securities from which to structure their models.
- Model and rebalance portfolio allocations according to bond characteristics such as duration, credit rating, maturity coupon, and yield.
- Increase speed and improve accuracy by reducing the manual data management effort, which exists in fixed-income processing today. For example, an automated security master file set up facilitates instantaneous trading.
'The market is responding enthusiastically, because WealthSolutions now allows asset managers to model, rebalance and trade fixed income securities much more efficiently and cost-effectively,' says Christian Bolanos, vice president of business development for BISYS Fund Services. 'Given the former technology constraints and complex operational procedures related to fixed income investments, SMA managers often resorted to implementing their clients' fixed income allocations with Treasuries or fixed income mutual funds.
Financial Research Corporation (FRC), a BISYS company, reports that as of the first quarter, only 14.5% of SMA assets are currently allocated to a fixed income strategy. But as baby boomers age and start shifting their assets toward a more conservative strategy, more complex fixed-income instruments will be required within an SMA program. In addition, FRC estimates that over the next five years, more than USD 200 billion in assets from IRA rollovers will be directed into SMAs.
'One of the many reasons we selected BISYS as our SMA outsourcing partner was its innovative approach to the SMA marketplace,' says Christopher Bell, chief operating officer of BISYS client Fifth Third Asset Management. 'As we increase and enhance our SMA product offerings, certainly fixed income securities will be an area of future growth, and we can feel confident that BISYS is there with the capabilities to support our progress and forward-thinking initiatives.'
According to Jim Nolan, executive vice president for BISYS Fund Services, the firm's fixed income capabilities have been in development for the past six months, transitioned into production in early May, and are now being considered by several additional asset managers.
'BISYS is clearly committed to finding practical, scalable solutions for SMA asset managers in light of the inevitable trend toward fixed income securities,' says Nolan. 'BISYS is helping our clients to anticipate the needs of their investors and participate in the growth opportunities they present.'
Background notes: BISYS WealthSolutions provides a comprehensive, flexible suite of services designed to meet the demands of the separately managed account (SMA) marketplace. BISYS' innovative outsourcing service model enables clients to focus on asset management and market penetration. Clients also benefit from BISYS' established operational infrastructure and state of the art technology that provides a single, consolidated platform for trade and account processing. WealthSolutions brings together BISYS' outsourcing expertise, proven infrastructure and experience in developing policies and procedures to SMA providers. Additional information is available at www.bisyswealthsolutions.com
The BISYS Group, Inc (NYSE: BSG) provides outsourcing solutions that enable investment firms and insurance companies to more efficiently serve their customers, grow their businesses, and respond to evolving regulatory requirements. Its Investment Services group provides administration and distribution services for mutual funds, hedge funds, private equity funds, retirement plans, separately managed accounts, and other investment products. Through its Insurance Services group, BISYS is the nation's largest independent wholesale distributor of life insurance and a leading independent wholesale distributor of commercial property/casualty insurance, long-term care, disability, and annuity products. Additional information is available at www.bisys.com.
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