Brown Brothers Harriman received the XCelent Service 2021 award for Depth of Customer Service for its InfoNAV technology and service offering, featured in Celent’s recent NAV oversight and contingency tools report.
InfoNAV, part of the Investment Operations, powered by Infomediary suite is a multi-provider, secondary NAV solution for asset managers to oversee their fund accounting service providers’ daily NAV. As a managed service, BBH’s fund accounting experts are actively involved in NAV construction, unique processing, and data management. Leveraging Infomediary, a robust data integration engine, the tool offers data file connectivity, translation, normalization, and workflow management to generate the secondary NAV for comparison to the primary NAV, accessible via the digital client experience platform Infuse™.
Oversight of the primary NAV, including a second source validation is an important area of regulatory compliance in many jurisdictions. In March 2020, during the height of the market volatility and unprecedented operational challenges, the need for efficient and accurate NAV oversight became top of mind as managers navigated high volumes of exceptions in the remote work environment. InfoNAV proved to be far more accurate than the common benchmark methodology, which flagged 71% of NAVs as out of tolerance and InfoNAV just 5%.1 These statistics demonstrated that InfoNAV introduced fewer exceptions and dramatically improved oversight and efficiency, relieving pressure on operations and risk teams to focus on true NAV issues.
Celent’s report profiles ten leading NAV oversight and contingency tools in use or being marketed to asset managers. The analysis showcases the relative position of providers in the following categories: Advanced Technology, Breadth of Functionality, Customer Base (number of clients), and Depth of Customer Service on two x/y scales. BBH InfoNAV was recognized in the Depth of Customer Service category.
“We are pleased to receive the service award from Celent,” said Christian Bolanos, Senior Vice President and Product Executive, Investment Operations. “Our clients and the industry have validated our value proposition to provide a robust, accounting-centric service offering alongside our technology in support of their requirements. BBH has a strong history of providing exceptional client service without exception, and we are proud to have InfoNAV recognized for doing so.”
Celent Analyst Andrew Schwartz added, “InfoNAV distinguished itself for exceptional end-to-end client service. Owing to the rapidly evolving NAV oversight and contingency regulatory landscape, it is essential for asset managers to work alongside a trusted partner.”
BBH Investment Operations, powered by Infomediary is an open architecture platform of technology and managed services for asset managers. We offer a full complement of modular, open-architecture technology solutions, and expert services, all powered by BBH Infomediary®, a robust data integration engine that easily connects and transforms data from our solutions, your solutions, and third-party solutions. InfoNAV is part of BBH’s Investment Operations suite of products. Let us help you create the operational data structure that best feeds your front office and supports your decision-making. Our experts help you build an efficient, resilient operating model —without sacrificing flexibility or control over your data, you preferred systems, or your business strategy.
Coniderations for Managers
These product structures may be ideal for an asset manager who is managing active strategies and is wary of publishing their holdings daily. When considering whether these products are right for their firm, managers should ask themselves:
- Which product structure is right for my strategy?
- How will I price these products alongside my existing investment menu?
- Should I seek to replicate existing strategies or launch something new?
- Will broker/dealer platforms support these products?
- What are the operational nuances that are unique to these products?
- How will I need to adjust my distribution strategy to support these products?
- How should I structure my capital markets team to support these products?
Asset managers should consider what strategies may work in this wrapper and how a proxy-basket, semi-transparent active offering could be added to their capabilities. BBH is ready to discuss these products in more detail and welcome the opportunity to engage with firms in deeper dialogue about this development.
Over the past 15 years, Brown Brothers Harriman (BBH) has partnered with more than 40 asset managers and sponsors to bring ETFs to market in the US, Europe, and Hong Kong. BBH has worked with all four proxy product sponsors and other third-party providers to design an operating model to service these products.
On December 10, the SEC approved new proxy-based, semi-transparent active ETF structures from Natixis/New York Stock Exchange (NYSE), T.Rowe Price, Fidelity, and Blue Tractor Group. While each of the products is unique, they all use “proxy baskets” to avoid the possibility that investors will use disclosed information about an ETF’s holdings to front run the strategy. These structures may provide a compelling option for active managers to enter the ETF market without revealing their “secret sauce.” In this edition of Exchange Thoughts, we break down the different features of these active structures.
1 Source: BBH, data as of March 9-27,2020
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