The recent upsurge by Australian superannuation funds reviewing their custody arrangements – a trend that is predicted to continue for potentially the next 12 to 18 months – is in line with global trends, although impacted by local regulators, says Madeleine Senior, the newly appointed head of Australia and New Zealand at Northern Trust.
Senior will assume the role on 1 September, and will lead Northern Trust’s business in Australia and New Zealand for both asset servicing and asset management. She will report to William Mak, head of Asia-Pacific for Northern Trust. She replaces Rohan Singh, who has been head of Australia and New Zealand since 2011.
Senior has worked at Northern Trust since 1995. Prior to being named head of Australia and New Zealand, where she was head of business development for Northern Trust’s asset servicing business in Europe, Middle East and Africa (EMEA). Before that, she was managing director of the Nordic region, based in Stockholm.
Senior points to her global experience and Northern Trust’s business as a global provider of asset servicing and asset management as strengths in her new role in Australia and New Zealand.
Senior notes that the recent upsurge by superannuation funds reviewing their custody arrangements – a trend that is predicted to continue for potentially the next 12 to 18 months – is in line with global trends, although impacted by local regulators such as the Australian Prudential Regulation Authority (APRA).
“Some of the reasons why clients are looking at providers in the market, some of that is around regulatory pressure,” Senior says. “That’s a key megatrend that you can’t ignore in this industry, and it’s a global trend. You have got the APRA saying that funds should undertake regular reviews of the providers, but equally many of the clients here are invested globally, so you have regulators across the world acting as a catalyst for change. We are asking clients to consider a provider that can provide all those services. “
Northern Trust has committed to invest $2 billion in technology globally over rolling three year periods, an investment driven by the increased demand for services, particularly around reporting, Senior says.
“There is a new data urgency in the market, prompting funds to produce regulatory reporting, prompting them to manage regulatory exposure, whether that be a stock or a currency, and that’s going to be increasingly important in all of our markets, but particularly in a market like Australia that is sophisticated and truly global.”
The third industry trend that Senior highlights is the push to develop retirement products for pension fund members.
“Governments and super funds and individuals are looking to commit more and more to retirement solutions, and everyone realises that there is a need to save for retirement,” Senior says.
“We’re seeing those pools of assets grow as population moves closer to pension fund age. Asset allocations are becoming more complex, clients are looking to generate alpha to offset future liabilities, they’re looking at other asset classes to do that – infrastructure, derivatives, property, as more and more people adopt a liability driven investment approach. As those needs become more global, there will be more need to hedge those risks, to provide accurate, fast reliable data, and they need a truly global provider who can have the expertise and the ability to provide that.”