Asia continues to lag other regions for integrating ESG principles with investing; better data and stronger regulatory requirements will help institutional investors, market observers say.
The bank is introducing these to the region after having built regional platforms for them in the United States and Europe, as well as in Australia and New Zealand.
Broker/dealer services involves several businesses but the main one is collateral management, including tri-partite repo. It has already handled collateral management for Western clients using Asian assets, but now will build a team to market this business to prime brokers and other potential users in the region.
ôInternational broker/dealers are looking to collateralise and fund positions in Asia,ö Gordon says. ôFirms use it either to positions on their own books or to finance clients who are taking these positions. This gives prime brokers a mechanism to collateralise their securities borrowings,ö which could be in the form of a loan, a repo or a swap.
Fund management companies are also users of collateral management in the US and Europe, often in the OTC derivatives space or to access short-term securities for money-market funds, but Gordon says this business has yet to emerge in Asia, in part because financing needs remain largely in the major hard currencies: the dollar, the euro and sterling.
Secondly, BNY Mellon is entering fund administration for hedge funds, private equity funds and funds of hedge funds in Asia and Japan. It has a global infrastructure out of the US and Europe to use initially. It is now looking to hire sales people, and as the business develops will consider building Asia-specific infrastructure for the service.
In this regard, BNY Mellon joins a number of other custodians now introducing fund admin for hedge funds in Asia, including Citigroup and JPMorgan, which are challenging the regionÆs established troika of alternative administrators: Citco, Fortis and HSBC.
Gordon now reports to Art Certosimo, globally responsible for these two business lines out of New York. His previous responsibilities will be assumed by his Southeast Asia counterpart in Singapore, Jai Arya. Gordon says Arya is able to manage clients across the region on his own because BNY Mellon is restructuring the organisation to focus more on function, with single regional heads of business units.
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