BNY Mellon to Extend Transition Management Services to Large Investment Management Companies Utilizing Outside Asset Managers

New York - 24 June 2013

Will Provide Same Services Offered to Traditional Asset-Owner Clients Such as Pension Funds

BNY Mellon, the global leader in investment management and investment services, is expanding its transition management capabilities to serve large investment management companies that typically utilize outside firms to manage some or all of their investment strategies.

These large investment management companies may utilize networks of sub-advisors to manage investment companies registered under the Investment Company Act of 1940 (40 Act Funds).

BNY Mellon has been providing transition management services to pension funds, sovereign wealth funds, endowments, foundations and other institutional clients since 1983. Now it has formed a registered investment advisor so it can provide its comprehensive suite of services to the large investment management firms, such as insurance companies, that manage registered 40 Act Funds. It should be noted that registration with the U.S. Securities and Exchange Commission does not imply any approval or endorsement by the SEC.

BNY Mellon Beta & Transition Management, part of the BNY Mellon Asset Servicing division of The Bank of New York Mellon, assists pension plans and other financial institutions move assets from one asset manager to another, or change the allocation of different types of assets in an investment portfolio, while aiming to reduce costs, risks and operational burdens.

"We're seeing growing demand for transition management services from insurance companies and other financial intermediary complexes that manage 40 Act Funds," said Mark Keleher, chief executive officer of BNY Mellon Beta & Transition Management. "These complexes increasingly are recognizing the potential benefits of new ways to minimize transaction costs and manage the investment and operational risks associated with overseeing such programs."

Keleher noted that while the utilization of transition management for large portfolio changes has been widely accepted by pension funds and other institutions that own the assets under management, it has been less widely adopted by financial institutions with sub-advisory platforms. For these investment management firms that have used transition management, many have historically tapped their existing broker-dealer relationships. Recent regulatory changes are causing many broker-dealer-based transition managers to leave the business, Keleher observed, and as a result, demand is rising for transition managers that are registered investment advisors.

"As we set out to serve these investment management companies, our basic process will not change," Keleher said. "Our expertise and experience with pension assets will be applied to the 40 Act Funds managed by these firms."

"Transition management is a key element of our investment services offering as we support clients across the entire transaction lifecycle," said Samir Pandiri, global head of BNY Mellon Asset Servicing. "BNY Mellon Beta & Transition Management follows the fiduciary model, which is well positioned to grow in the current business and regulatory environment."

BNY Mellon Beta & Transition Management focuses on offering a toolkit of solutions for clients striving to maintain their investment exposures in a constantly changing world. Strategies are tailored for clients seeking to manage beta exposures, rebalance assets, and enter or exit investment strategies. Serving a global client base, it offers a comprehensive fiduciary approach that is dedicated solely to serving the beta and transition management needs of clients.

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