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Strategic Banking Solutions Create Innovative Opportunities for Administration Clients

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Dan McNamara, Chief Strategy Officer

Given the rapid digital transformation of our industry, it’s become routine for strategy discussions to focus primarily on new technology. But recent turmoil in the banking industry provides an opportunity to drive home the message that it’s critically important for clients to have stable, reliable partners with strong credit positions to help minimize counterparty risk.
Our firm has spent the past decade becoming a leader in fund administration and asset servicing, providing the middle- and back-office support that enables our clients to focus on driving growth. And increasingly, existing and potential clients are asking, “what about banking?”

The question is not surprising, especially in a time of some uncertainty in the global financial markets. As a division of Mitsubishi UFJ Financial Group, Inc., one of the world’s largest banks with approximately $3 trillion in assets, MUFG Investor Services leverages a wide array of banking experts, products and services to provide scalable and flexible solutions across the investment value chain.

Those banking solutions range from accounts and global payments to foreign exchange, liquidity solutions and escrow services, and provide asset managers with an established, solid partner to hold and manage cash. And the firm’s unique, global footprint is a significant differentiator among our competitors, with our banks in the Cayman Islands and Luxembourg offering balance sheet strength, the ability to earn cash in interest-bearing accounts and comprehensive banking relationships.

In a post-pandemic business climate where clients are increasingly relying on outsourcing, we are exploring new ways to expand our banking services with select, well-established asset management firms or hedge funds. Our long-time practice has been to offer banking services only to our fund administration clients. Going forward, we’re adapting that approach to offer our banking capabilities to select fund managers and management companies to build new relationships that will lead them to our wide array of products and services including fund and loan administration, business processing outsourcing, fund financing and limited partner servicing. In addition, we’ve found that prospective clients are not aware that our technology and infrastructure support can help them avoid expensive overhauls of their own legacy systems.

Our priority is, and remains, fund administration and asset servicing. But we believe it’s important to have bigger conversations with current and prospective clients to explore how our global model may help them to better focus their resources on generating returns for their investors.