JP Morgan Asset Management Outsources Operations…to JP Morgan
Posted by Colin Lambert. Last updated: November 18, 2021
JP Morgan Asset Management (JPMAM) says it has selected JP Morgan’s Securities Services division, part of the Corporate & Investment Bank, as the provider to support a new global operations model using its investment middle office services capabilities.
The firm says the outsourcing of these services will enable it to drive value for its clients through investment expertise, insights and performance results while leveraging the expertise and scalability of other parts of the firm. It will also ensure that JPMAM can leverage a service oriented, scalable, end-to-end operating platform to enable business growth.
“We reviewed a number of alternative strategic operating models and after extensive due diligence selected JP Morgan,” says Fred Crosnier, global head of operations at JPMAM. “A new globally consistent investment book of record facilitates our investment decision making process and enables us to seamlessly add new product capabilities.”
JPMAM is commencing a multi-year initiative to implement the model, it says, which includes the provision of middle office services, collateral management and risk analytics. It says the diverse nature of its business across different market sectors, investment products, asset classes, vehicles and jurisdictions requires a service provider with extensive scale and capabilities to meet those needs. These new services add to the custody and accounting services that JP Morgan already provides to JPMAM.
“Clients are requiring ever-increasing support from their middle office provider, to both enable their expansion into more sophisticated investment strategies as well as deliver continuous operational scale and efficiency,” says Scott Bevier, global head of investment operations services, JP Morgan. “As a leading custodian service provider affiliated with the number one markets franchise, we are uniquely positioned to provide solutions to enable our buy-side clients to leverage the full breadth and depth of our expertise, systems, and global scale & connectivity. We’re excited to expand our long-standing partnership with JPMAM by delivering these next-generation capabilities.”
The first phase is planned for mid-2022, when JP Morgan will provide operational processing support for a range of derivatives products. This change will enable JPMAM to efficiently implement the use of new and different products, thereby expanding its derivatives capabilities. Subsequent phases will commence in 2023, and will involve migration of the operational servicing of other asset classes.
“Working with a provider who can deliver the scale and capabilities to support our investment activity from end-to-end, allows us to focus our resources on investing for our clients” says Andrew Powell, chief administrative officer and global head of client service, JPMAM. “Continued downward pressure on fees and expenses means that asset managers need to deliver an exceptional investment experience while also creating efficiencies and economies of scale in middle or back office services.”