New Outsourcing Group Launched By BNY Mellon

Lou Maiuri, global head of outsourcing, BNY Mellon, talks to about his new appointment, and the creation of BNY Mellon Outsourcing Group
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BNY Mellon Asset Servicing has created a new Outsourcing group. Lou Maiuri, CEO and chairman of Eagle Investment Systems, will take on the role of global head of outsourcing, reporting to Jim Palermo and Tim Keaney, co-CEOs of BNY Mellon Asset Servicing.

Speaking to, Maiuri explained that the move was a natural extension to his career. Eagle has been doing a form of outsourcing with software as a service for the past five-to-six years, he said. For me this is a natural evolution to what I have been doing, but with a new and innovative way of delivering our solutions to a growing marketplace. Eagle was bought by Mellon Financial Corp now BNY Mellon in 2001.

The new group will place 990 people working collectively in outsourcing for BNY Mellon under one line of business. Maiuri says the business will have a full profit and loss, meaning we can invest in our business, we can make decisions on how we move the platform forward as opposed to being just a function within a line of business.

Although regionally based in the U.S., the group has an even E.U. and North American focus, with future business in the pipeline split between the two regions. Maiuri is targeting medium to large complex global managers looking to outsource pieces of the middle office. Regarding long-term regional focus, new business may stem from Asia, especially China and Singapore, where lots of money manager are not looking to establish a middle office, rather plug into a service.

Discussing what areas Maiuri aims to tackle as head of the group, standardisation within the outsourcing industry remained key to his plans. In the early stages of outsourcing, there was no such thing as standardisation. To move to a different provider was like taking open heart surgery without any medication. Maiuri aims to establish standard blocks of functionality. There is always customisation on the edges, but your trade communication component doesnt have to be customised, your record keeping component doesnt have to be customised, youre information delivery and performance measurement can be standardised. I think the industry needs standardisation, if everything is a one-off there will be no scale, no leverage, and if I am a buyer of those services, why would I want to be entangled with the provider? This is something we are hoping to address.

Regulation, a hot topic in many silos of business, remains a talking point for outsourcing. Although cost is a major issue, says Maiuri, cost avoidance going forward is also an issue, whether that is IFRS standards, or local regulations.

The new group aims to combine back office functions such as administration and recordkeeping with middle office servicing capabilities, spanning multiple books of business, all on a single platform to offer enhanced efficiencies and cost savings to the client.

The drive towards a single platform has been a business focus Maiuri at Eagle. The drive has paid off, with Delaware Investments, a Philadelphia-based diversified asset management firm, signing up to the new outsourcing platform. A combination of Eagle STAR and PACE technology will provide accounting, administration, and certain back-office services support to all of Delaware Investments U.S.- and Dublin-domiciled mutual funds, institutional separate accounts, and other products. Delaware Investments, asset management firm based in Philadelphia, has more than $135 billion in assets under management as of September 30, 2009.

For nearly a decade weve built a strong relationship with Delaware Investments, and this new mandate takes us to the next level, said Maiuri. Especially in todays environment it makes sense for many investment firms to focus more on managing assets and client relationships the things they do best while relying on service providers like us to administer the back-office and maintain the technology investment.

Maiuri will remain Chairman of Eagle. John Lehner, currently Eagles president, will take over the role of Eagle CEO as of January 1, 2010.

BNY Mellon Asset Servicing today services 54 outsourcing clients with $1.7 trillion in assets worldwide.

Giles TurnerNews Editor