The Bank of New York has enlarged its presence in the fast-growing clearance business with the acquisition of the back-office transaction clearance and settlement capabilities of London-based Tilney Investment Management. The bank’s UK subsidiary BNY Securities Limited will also provide fully disclosed clearing services to Tilney Investment Management as the first client of the expanded business.
The deal also accelerates BNY Securities’ entry into the private client stockbroker and investment management services market, complementing the bank’s institutional brokerage capabilities, which already provide clearing services in the European market on both a fully disclosed and omnibus basis.
The U.K. retail clearing service is aimed at execution-only, advisory and discretionary private client stockbrokers and investment managers on a model A and B basis. The services provided include: multi-currency execution, settlement and accounting services, detailed client record keeping and client reporting and cash management.
“This strategic move expands our capabilities and offers U.K. brokers the opportunity to benefit from the cost, control and efficiency of the leader in clearing and global securities servicing outsourcing,” says Gerald L. Hassell, president, The Bank of New York. “Pressure on margins and potential capital adequacy changes in Europe are leading an increasing number of brokers to review their current back-office and clearing arrangements.”
Carles van der Merwe, MD, BNY Securities, added: “This acquisition is key to expanding our European correspondent clearing capability. We are confident that our service offering, with sophisticated and scalable STP technology, together with our industry specialist resources, makes BNY Securities the U.K. market’s superior service provider.”
David Campbell, executive chairman, Tilney Investment Management, said, “This arrangement ensures that Tilney Investment Management will continue to benefit from a first-class support infrastructure, built around known expertise and enhanced by the technology, focus and commitment of BNY Securities. Working with a recognized global leader in securities outsourcing is the best way of securing optimal future operating efficiencies for Tilney and will enable us to concentrate on what we do best – providing superior returns and service to our clients.”
John Norbury, chief executive officer, Tilney Investment Management, added, “This transaction continues the transition of Tilney from a stockbroker to an asset management business.
We can now fully focus our resources on the development of investment processes and products, enhancing our service to clients in an increasingly sophisticated financial market.”
The Bank of New York, through the clearing division of BNY Securities Limited, provides securities clearing, execution, and settlement to broker/dealers, banks and other financial intermediaries throughout the world. BNY Securities focuses on serving the institutional and broker/dealer community. The Bank also seeks to enhance the performance of correspondents by providing a broad range of value-added non-broker/dealer services, including best execution practices, efficient clearing and differentiated value-added products and capabilities.