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BNY to acquire managed account solutions provider Archer as custodian looks to capitalise on rapidly growing space
The acquisition will enhance BNY ’ s capabilities across the entire managed account ecosystem as its head of asset servicing Emily Portney tells Global Custodian that asset management clients see this as an ‘ enormous area of expansion ’ that is crying out for traditional servicing .
The Bank of New York Mellon Corporation ( BNY ) has entered into a definitive agreement to acquire Archer , a technologyenabled service provider of managed account solutions to the asset management industry . With the integration of Archer ’ s managed account solutions , capabilities and professional servicing team , BNY plans to enhance its enterprise platform , supporting retail managed accounts across its entire platform and servicing a market that is projected to grow at a double-digit compound annual growth rate to over $ 8 trillion in assets over the next three years in the US . “ I have not been in a meeting with an asset manager since I ’ ve taken this job 18 months ago where they have not asked me about how BNY can help them with managed accounts ,” Emily Portney , global head of asset servicing at BNY , told Global Custodian . “ More specifically , retail managed accounts . “ We know the market is growing at a double-digit compounded annual growth rate . The irony is that a large part of this market is actually serviced in-house by asset managers themselves because no one has yet cracked the nut of how to do this at scale ; hence why Archer is just so impressive and important . It is one of the very few service providers out there that has a full tech stack and provides operational support for retail managed accounts .” The transaction is expected to close in the fourth quarter of 2024 , subject to regulatory approvals and other customary closing conditions . Financial terms were not disclosed . In addition to augmenting BNY ’ s existing asset servicing capabilities for managed accounts , Archer will provide BNY Investments and BNY Pershing ’ s Wove wealth platform for advisors with expanded distribution of model portfolios and access to Archer ’ s multi-custodial network . “ In asset servicing , we will now be able to service these vehicles just like we service mutual funds , money market funds , ETFs and private investment vehicles , on behalf of all of our clients ,” added Portney . “ So this was a missing piece . You are never fully complete , because the industry and products are always evolving … but it certainly was an area that , at least in asset servicing , there really was a gap .” Archer provides asset and wealth managers with middleand back-office solutions to address the managed account needs of institutional , private wealth and retail investors . Through its cloud-based platform , Archer aims to help its clients to expand distribution , streamline operations , launch new investment products and deliver personalised outcomes to a broader market . “ Today ’ s asset and wealth managers have a strong desire to create multi-asset solutions across a variety of products , along with direct indexing and tax optimised portfolios , to meet the needs of their distribution partners and investors ,” added Bryan Dori , president and CEO of Archer . “ As a new addition to the BNY platform , Archer ’ s expertise , capabilities and scale will be leveraged across all of BNY to help even more clients drive long-term growth for their businesses .” Regarding BNY ’ s approach to acquisitions , the Archer deal is not symbolic of a shift in approach , but the asset servicing giant does remain open to being active in adding to its services . “ We ’ ve always said that we are open to inorganic opportunities ,” explained Portney . “ They [ the opportunities ] were going to be digestible opportunities that add capabilities , new types of clients , or particular jurisdictions . And that ’ s how we have thought about acquisitions . This , like I said , is extraordinarily complementary .”
12 Global Custodian Fall 2024