In other news, Northern Trust embraces fund distribution transparency, SIX targets Nordic markets with help from Nasdaq, and LSEG acquires a KYC specialist.
GSAM to Use NextCapital for Defined Contribution Foray
Goldman Sachs Asset Management (GSAM) is acquiring Chicago-based robo-advisor NextCapital Group to hasten the development of Goldman Sachs’ offerings for the defined contribution market via personalized managed accounts and digital advice, officials say.
The transaction is slated to close during the second half of this year, depending upon regulatory and related approvals and conditions, officials say.
NextCapital works with “financial institutions across the United States to deliver personalized, customizable retirement planning and managed accounts through workplace retirement plans and individual retirement accounts (IRAs),” officials say.
The vendor offers its open-architecture platform to asset managers, plan sponsors, advisors and recordkeepers “to meet individual investor demand for more digitalization, retirement income solutions, tailored strategies and insights,” officials say.
Goldman Sachs Asset Management works with employers to develop retirement programs for employees, “with total defined benefit (DB) and defined contribution (DC) assets under supervision of approximately $350 billion,” officials say. “The acquisition of NextCapital will augment existing capabilities throughout Goldman Sachs’ asset and wealth management businesses, providing another tool for sponsors and other clients to consider when constructing a retirement program.”
When the transaction closes, “NextCapital’s platform is expected to become part of the Multi-Asset Solutions (MAS) business of Goldman Sachs Asset Management, which has offered custom multi-asset portfolios from Goldman Sachs and third-party asset managers for over 20 years,” officials say. “Led by Greg Calnon, the group has approximately $220 billion in assets under supervision today, ranking it the largest Outsourced Chief Investment Officer (OCIO) provider in the U.S. and second largest globally by outsourced assets under management.”
The NextCapital team will remain based in Chicago, officials say.
Northern Trust Partners with Finscape
Northern Trust is working with Finscape, a joint venture between fund research house, Fundscape, and financial services systems supplier Altus, to offer clients “a comprehensive view of their fund distribution activity,” officials say.
“By streamlining market intelligence gathering, the service … aims to help address industry-wide challenges around data transparency,” officials say. “Under the agreement, Northern Trust will make Finscape available to its asset manager clients globally, allowing them to carry out forensic analysis of distribution, providing them with access to valuable information to inform their sales strategy and help them to meet regulatory requirements.”
The Finscape offering also helps asset managers identify investors in their funds “where sales are made via a third-party fund distribution platform,” officials say. “In such instances the transfer agency register shows a nominee position in the platform’s name, potentially creating challenges for the asset manager to readily identify the end distributor in the investment ‘chain.’ ”
“Fund distribution has become increasingly fragmented and complex, with a range of third parties often sitting between asset managers and their investors. We are pleased to be working with Northern Trust to help its clients streamline their market intelligence needs,” says Bella Caridade-Ferreira, joint managing director at Finscape, in a prepared statement.
SIX Uses Nasdaq IT for Clearing Nordic Markets
Using technology from the Nasdaq Stock Market, SIX launched a clearing IT infrastructure for the Nordic markets on March 28 that the vendors will bring new efficiencies and scalability to the region, officials say.
“The platform has been integrated into the SIX Post Trade Architecture (PTA) and has been in stable operation since Monday 28 March,” according to SIX. “The improved IT infrastructure will enable the clearing of 10 million trade legs per day, with SIX expecting an increase in the number of cleared trades going forward. SIX intends to extend the markets and trading venue coverage for Swiss clearing onto this new platform as the next step of its evolution.”
The upgrade will provide “continued enhancement of the IT infrastructure and reliability; and increased functionality and processing capabilities,” officials say.
SIX operates and develops infrastructure services for the Swiss and Spanish Stock Exchanges, offering post-trade and banking services and financial information. The company is owned by 120 banks and has 3,685 employees serving 20 countries.
LSEG Acquires GDC to Battle Financial Crime via KYC
London Stock Exchange Group (LSEG) will be acquiring Global Data Consortium Inc, (GDC), a provider of identity verification data to help clients battle financial crime via know your customer (KYC) requirements.
“GDC provides global name and address matching capabilities that enable them to accurately source and enhance data from over 300 data sources globally and to deliver high quality identity data in near real-time for over 70 countries,” LSEG officials say. “GDC will be part of LSEG’s Data & Analytics division.”
“Adding GDC to the suite of digital identity solutions within our Data & Analytics division, will enable us to continue to expand our capabilities in this high growth segment, through both direct sales and channel partnerships,” says Andrea Remyn Stone, group head, data and analytics for LSEG, in a prepared statement. “I look forward to working with the team at GDC to deliver on our promise of being the platform of choice to manage financial crime related risks.”
“The acquisition of GDC, combined with our existing capabilities from GIACT and Qual-ID, will enable customers to verify digital identity and protect against fraud globally with a suite of real-time, accurate solutions,” says Phil Cotter, group head of customer and third-party risk solutions for LSEG, in a prepared statement.
“Refinitiv acquired a 11 percent stake in GDC in 2020. The terms of the transaction have not been disclosed,” say LSEG officials who add that the transaction may close during the first half of 2022, subject to regulatory approvals.
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