European pension funds have seen considerable flux in 2010. Many have had to reassess their risk profile and, as a result, have reduced equity weightings and invested more widely in fixed-income assets. There has also been a widespread embracing of alternative asset classes as pension fund managers seek to improve diversification.
JP Morgan has proved itself a flexible custodian in this environment – its assets have grown 8.1% under custody to June 30, 2010 and now sit at $14.9 trillion.
It has benefited from a reputation for efficiency, particularly in its on-boarding programme. But, most of all, it is the breadth of its offering that has appealed most to clients – it has a wide-reaching securities lending programme; it can offer sophisticated accounting and performance measurement service; and it can support a wide range of alternative investment strategies.
April 2010 saw the group launch a pensions blog, which now has 43 participants from 33 organisations across the UK, the US, the Netherlands, Germany, Denmark and Sweden. The blog has been designed as an information-sharing tool and helps provide an insight into the key concerns facing pension funds. It also provides a forum for pension funds to share knowledge and experience, and has acted as an invaluable source of pensions information.
The group says it has helped foster engagement, collaboration and a sense of community across its pension fund industry contacts.
A major innovation this year has been in the group’s fund order routing and settlement services. It can now provide an improved range of solutions covering subscription and redemption management, communication with transfer agents, settlement, and registration and asset servicing for pension funds with large investments in pooled funds.
It also provides JP Morgan’s clients with an electronic means by which they can instruct these subscriptions or redemptions across the widest possible range of mutual funds, hedge funds and other complex fund structures.
The group has continued to build on its technical expertise with a new collateral engine for its clearance and agency business that now provides consolidated risk reporting on collateral exposure.
Collateral has been an important consideration for clients this year and this initiative demonstrates JP Morgan’s ability to adapt to the changing market environment.
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