BNY Mellon is expanding its separately managed accounts (SMA) platform to Singapore, some seven months after receiving a licence to roll out similar capabilities in Hong Kong.
The Monetary Authority of Singapore awarded a capital markets licence to BNY Mellon last month, allowing the $1.5 trillion US investment management and services firm to set up the SMA business in the city state. (The licence also permits it to offer a full range of services out of the city, including research, portfolio management, marketing and sales. Previously it had just served as a research office.)
BNY Mellon aims to partner private banks, which in turn will provide SMAs for discretionary portfolios using BNY Mellon's platform.
To build out in Singapore, the firm hired Chris Faddy earlier this year from Credit Suisse Asset Management as a managing director, and after receiving the capital markets licence on November 11, named him head of distribution of managed investments. Faddy joined in May from Credit Suisse Asset Management, where he served as head of distribution for Asia ex-Japan. He previously held similar roles at Barclays Capital Fund Solutions, the asset management business of the UK bank, and Goldman Sachs.
Part of Faddy’s remit will be to market BNY Mellon’s SMA platform to private banks in Singapore. The firm’s SMA distribution teams in Singapore and Hong Kong will report to Faddy, who in turn reports to AJ Harper, president and CEO of the SMA business in Asia Pacific.
“Chris’s job will be to take the product to the private banks in Singapore and really help them use this discretionary service,” Harper says.
Harper declined to offer headcount numbers or offer goals for how many executives BNY Mellon hopes to hire. He also declined to say if the firm has actually partnered any private banks yet.
Harper notes that while there has been a tremendous build up of wealth in Asia, providing opportunities for private banks, there hasn’t been much discretionary management of their money given the lack of infrastructure and educational training.
There has been “wealth accumulation in Singapore which is driving private banks’ need for discretionary services,” argues Harper. “[And so] we’ve been ardently building the manufacturing capabilities, adding a back-, middle- and front office to allow the SMA platform to be available.”
In addition to partnering private banks, BNY Mellon is looking to collaborate with third party asset managers to provide investment strategies that will be available in the SMA structure. BNY Mellon will be one of the managers on the platform.
It follows the firm's moves in Hong Kong after it received types 1, 4 an 9 licences from the Securities and Futures Commission this June.