The St George-owned Asgard platform will outsource its separately managed account (SMA) capability and plans to appoint a new operator by the end of the year.
Asgard added a range of SMAs to its platform in 2002 but the products proved to be a slow-starter and to date have only garnered $90 million. However, Dean Thomas, Asgard head of product, says the SMA concept is a sound one and the technology to offer cheap, direct share model portfolios has improved dramatically. While Asgard has run its SMA technology in-house Thomas says it is considering a range of vendors to take over the administration of the products – one of whom is sure to be Praemium, the recently-listed portfolio administration provider which Asgard yesterday named as its new direct equities back-office reporting system. Last year Praemium signed a deal with Merrill Lynch to provide the back-office engine for a new SMA service, which provided for a period of exclusivity expected to be end next year. Thomas could not confirm Praemium was a candidate for its SMA service and said there were many other options for Asgard to consider. “There are lots of boutique [SMA providers] out there and other vendors have entered the market,” Thomas said. Geoff Lloyd, head of Asgard Wealth Solutions, said the recent deal with Praemium was part of Asgard’s revamp of its direct shares offering to advisers with the aim making the platform’s equities component as “easy to use” as its managed funds services. “This new arrangement heralds the launch of a major project by Asgard to upgrade our equities offering in response to growing demand from financial advisers and investors to give shares similar administration and reporting treatment as managed funds,” Lloyd said in a statement yesterday. “This is all part of our plan to bring a next-generation shares offering with enhanced trading, settlement and reporting capability to the market.” Praemium and Asgard announced a heads of agreement yesterday with the final details of a five-year contract to be hammered out over the next three months. However, in a departure from its usual practice Praemium said yesterday it was likely to be paid by Asgard based on funds under management. In the past Praemium has prided itself on charging a flat fee per portfolio rather than any asset-based approach. Praemium’s share price jumped 6 cents over the day to close at 54.5 cents at the end of trade yesterday.
Since taking over the top job at the $44 billion Funds SA more than a year ago, chief executive John Piteo has ushered in an investment function overhaul and wrapped up an important stage of the fund’s five-year data transformation program. It pledges to recentre around investment performance and more efficient processes, as the “missing piece” has been found in incoming CIO Con Michalakis.
Darcy SongJanuary 10, 2025
