Derivatives Portfolio Management (Bahamas) Ltd. (“DPM”) and Oceanic Fund Services announced Wednesday the formation of a service provider to assist local fund administrators with a full range of back office services.
DPM is a fund administrator servicing the growing hedge fund market with a suite of services that include daily investment accounting, financial reporting, multiple broker and trader reconciliation, systems-generated net asset value (“NAV”) calculations, risk transparency and other fund administration services.
Oceanic Fund Services is a fund administrator and subsidiary of Oceanic Bank and Trust Limited, (jointly, “Oceanic”).
“In recognition of DPM’s advanced, Internet-enabled technology and fund administration services, including daily investment accounting and NAV calculations, Oceanic decided to outsource the back office accounting of our Stars Funds to DPM, ” said Bruce Bell, Managing Director of Oceanic. “The ability to provide our investment management group with full transparency and key investment data on a daily, rather than monthly basis, was the prime motivator in considering DPM’s outsourcing solution.”
“In today’s rapidly changing business conditions, outsourcing to specialists is becoming commonplaceﾗin global custody, asset management and fund administration,” said Robert Aaron, Chairman and CEO of DPM. “In conjunction with Oceanic, which has had a presence in The Bahamas since 1982, we are offering a wholesale back and middle office solution to fund administrators in Nassau to enable them to take on new business, reduce the business risk, contain their costs and improve service, using our Web-based platform.”
Funds Clearing (Bahamas) Limited will enable local fund administrators to migrate applications to the Internet, to process transactional activity electronically, to receive daily portfolio reports marked to market and daily NAV calculations. As investors are looking for increased transparency, especially in the managed funds segment of the industry, the use of the Internet as a processing and communication tool has introduced a new set of standards in fund administration.
Commenting on transparency, Mr. Aaron added, “Transparency is a form of risk controlﾗenabling investors to evaluate market, fund manager and credit risk. Administrators who adopt e-commerce applications can provide transparency through daily, accurate reporting, but they also benefit from the low costs of computing and communications. Once a function has been migrated to the Internet, the marginal cost of communicating, storing and analysing data is effectively zero.”
Terah Rahming, ManagerﾖFund Services, with Oceanic, said, “Eliminating the burden of manual input of data and the risks of human error reduces the business risk, increases our responsiveness to our clients and allows me to employ our staff more effectivelyﾗall of which contribute towards a greater degree of job satisfaction for Oceanic’s fund administration team. We are positioning Oceanic to take on new funds, which would otherwise be turned away.”
Bill Thomson, Vice President- Investments at Oceanic, commenting on the industry’s legacy systems, said, “The fund administration industry is burdened with antiquated systems and time consuming manual processes, which are inappropriate and inefficient in today’s environment. Our own clients are demanding greater transparency, daily and in some cases, intra-daily NAVs. The world of fund administration became a whole lot more competitive with the advent of Internet-enabled systems. Fund administrators are being forced to adopt new performance standards and expensive system changes, while facing pressure to reduce fees. Funds Clearing (Bahamas) Limited has the solution.”
Funds Clearing is a service provider to fund administrators in Nassau who wish to outsource some or all of the components of the back and middle office functionsﾗincluding automated interfaces to capture position management, integrated feeds from multiple brokers, daily trade and positions reconciliation, daily mark-to-market interfaces, daily/weekly/monthly investor reportingﾗusing a Web delivery platform.
DPM is a subsidiary of Derivatives Portfolio Management L.L.C., headquartered in Somerset, New Jersey, which offers a portfolio of integrated fund administration services to more than 200 funds with $12 billion in assets. Established in 1993 by recognised investment industry professionals, DPM, L.L.C. provides its services to fund managers, asset allocators, institutional investors and proprietary traders whose portfolios cover almost all asset classes and instruments traded wordwide. The management team in Somerset, New Jersey, and the staff of the Grand Cayman, Nassau and London offices, provide the resources and expertise of a full service organisation.
Oceanic Bank and Trust Limited is a fully licensed bank and trust company with its headquarters in Nassau, The Bahamas, and offices in Freeport, Barbados and London. Oceanic’s assets under administration currently exceed USD $5.0 Billion. It offers private banking, trust and estate administration, investment management, mutual and hedge fund administration, and corporate management services. Oceanic was established in 1982 and is an active member of both the Association of International Banks and Trust Companies in the Bahamas and the Bahamas Financial Services Board. Oceanic’s core purpose is to create innovative wealth management solutions.
