JP Morgan Confirms Threadneedle Investments Outsourcing Contract

JP Morgan today confirmed what the market has known for some time: it has won the outsourcing mandate from Threadneedle Investments
By None

JP Morgan today confirmed what the market has known for some time: it has won the outsourcing mandate from Threadneedle Investments. Competitors argue that the bank had little choice but to do what was necessary to acquire the contract in order to re-establish its credibility as a fund management outsourcing provider in the wake of the collapse of the Schroders contract.

Threadneedle and Morgan are presently in exclusive negotiations, which they expect to finalise next month. Operational control of Threadneedle’s Swindon-based Investment Operations function will pass to JP Morgan in October 2006 by way of a “lift out.” Morgan says the Swindon staff will “form an integral part of JP Morgan’s expanded European service offering.”

The mandate includes confirmation and settlement, valuations and pricing, and accounting activities for all of Threadneedle’s funds.

“We believe this is excellent news for our current and future clients,” says Crispin Henderson, Managing Director of Threadneedle Investments. “This deal allows Threadneedle to focus on its key strengths as a fund manager – providing excellent investment performance for its clients. Our clients will benefit from JPMorgan’s strengths in service administration and commitment to providing state-of-the-art capabilities in derivatives and complex instruments – an integral part of many of Threadneedle’s products. We aim to achieve these benefits with a high degree of continuity, as the only real difference in the short term will be a change of operational control – the people, processes and systems will remain unchanged.”

Conrad Kozak, JP Morgan Securities Company Executive, says the deal with Threadneedle will help the bank build up its international operations services. “We are confident that we will continue to exceed our clients’ service expectations and help them achieve greater success by anticipating their evolving needs,” he says. “For JP Morgan Worldwide Securities Services, this transaction is about supporting Threadneedle’s investment operations needs as well as enabling us to continue to lead the industry in servicing our clients’ complex investment strategies.”

Threadneedle was advised throughout the selection and negotiation process by Troika, the specialist financial services management consultancy.

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