Third-party administrator Mainstream BPO, which yesterday celebrated its first birthday, is looking to enter the super member administration market and may announce its first deal as early as next month.

Byram Johnston, the chief executive, and Martin Smith, the chief operating officer, said last week that by July 1 the company would have 12 clients administering 31 funds totalling $1.1 billion in funds under management. Smith said that there was a lot of demand from smaller managers which were getting their custody through their prime broker relationships but who wanted to keep administration separate. “We’re dealing a lot now with managers offering long/short funds,” he said. “We’re also seeing strong demand in the middle-office area for boutiques.” Johnston said: “We’re seeing two to three individuals every week who are looking to jump out of big shops with backoffices to start out on their own. Until they get to about $1 billion in FUM they don’t want to have to buy their own system.” On the super admin development, he said that he was hopeful of being able to announce a move by the end of June. “We are still considering an acquisition as well as building that business from scratch,” he said. Without an acquisition Mainstream BPO would probably concentrate initially on the self-managed part of super. Under its licence with systems provider DST International, Mainstream BPO allows clients to do their own reports in their own time, however the clients cannot do their own processing. “The days of emailing daily reports to clients are going,” Johnston said. “They want the information at their fingertips.” Mainstream BPO does not provide an RE or custody service because the firm believes that would be a conflict. Its preferred custodian is JP Morgan.

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