Citogroup Global Transaction Services and Dutch insurer AEGON say they will be working together to create an investment platform designed to facilitate the use of a range of asset strategies, including portable alpha, through pooling. Citigroup claims “the platform is the first full service solution to support the process and administrative needs of investors, institutions, asset managers and pension funds who operate in multiple jurisdictions throughout Europe.”
The aim is to enable every institution using the platform to fulfill the different tax, accounting, regulatory requirements and reporting obligations of the various countries and jurisdictions where its investors reside. A subsidiary ambition is to improve investment performance by enabling users to invest in a wider range of asset classes and investment styles. It is expected that the platform will be fully operational by the third quarter of 2007.
As part of the agreement, AEGON’s investment management affiliates in The Netherlands will outsource their back and middle office activities to Citigroup. The transaction applies to a total of Euros 40 billion in custody with Citigroup, for which the bank is providing fund administration, performance management, transition management, a range of customized equity-related services and post-trade compliance functions, in addition to custody, securities lending, and fund accounting. It is anticipated that the migration of current funds will take place in the second quarter of 2007.
“In Citigroup we have found a partner that understands our desire to come up with a highly innovative product,” says Erik van Houwelingen, board member of AEGON The Netherlands. “The platform’s possibilities are almost infinite and it supports AEGON’s strategy to provide our clients with innovative asset management solutions efficiently and effectively, allowing our clients to benefit from the product and scale benefits that can be achieved.”
Francesco Vanni d’Archirafi, Chief Executive Officer of Citigroup Global Transaction Services for Europe, Middle East and Africa, says Citigroup is “thrilled to be extending our relationship with AEGON to create this innovative platform.”