Northern Trust announced today it has been appointed by Bridgewater Associates, one of the world's largest global hedge fund managers, to independently replicate certain middle and back-office services for its approximately $140 billion in assets under management, as part of Bridgewater's ongoing back office transformation plan.
In a role that will create approximately 100 jobs in Chicago and Stamford, Conn., Northern Trust will provide broad middle-office and back-office services including replicating various administrative processing, trade processing, valuation, real-time reporting, cash management, accounting and collateral management services.
These services will be furnished by Northern Trust independently, as well as mirroring and quality checking middle and back-office services provided by another firm. Northern Trust's independent review and validation of results will provide Bridgewater Associates and its investors an enhanced level of oversight and controls with respect to fund administration and middle and back-office functions. The arrangement is planned to go live in 2014.
"We welcome this important strategic relationship with Bridgewater Associates," said Steven L. Fradkin, President of Corporate & Institutional Services at Northern Trust. "As one of the largest and most successful hedge fund managers in the world, with a long-standing commitment to transparency and excellence, Bridgewater Associates understands the value of a trusted global partner that can provide an additional check and validation for their clients. This innovative relationship sets a new standard of independence, which will benefit Bridgewaters clients while reinforcing its leadership in the industry."
"We are delighted to be working with Northern Trust and to draw on their leading-edge technology and expertise for the benefit of our clients," said Eileen Murray, Co-President of Bridgewater Associates. "At a time of unprecedented change and uncertainty for investors, Northern Trust's independent review mandate as part of our ongoing transformation program at Bridgewater is designed to provide an added level of protection and security for our clients."
Since Northern Trust acquired hedge fund administrator Omnium from Citadel in July of 2011, the marketplace has delivered a strong response to the combination of Northern Trust's trusted name and global scale along with industry-leading, technology-driven hedge fund administration services designed to support high volume and highly complex investment strategies.
"This is a transformational relationship creating independent controls and a new level of review and checks by two independent administrators," said Peter Sanchez, Chief Executive Officer of Northern Trust Hedge Fund Services. "As the hedge fund business model evolves, we expect our relationship with Bridgewater will lead the way toward the structure and independent controls that hedge fund investors will demand in the future."
Northern Trust is one of the world's leading asset servicing providers, offering global expertise and local specialist services to investment managers and institutional investors in more than 40 countries. Northern Trust's Corporate & Institutional Services business unit is a leading global provider of asset servicing, asset management, and related services to fund managers, sovereign wealth funds, pension funds, foundations, endowments, insurance companies and government funds. Northern Trust serves clients worldwide with teams based in Dublin, Limerick, London, Luxembourg, Guernsey, Chicago, New York and Hong Kong.
Bridgewater Associates is a global leader in institutional portfolio management with approximately US$140 billion in assets under management, including US$75 billion in its Pure Alpha strategies (a hedge fund/GTAA/Portable alpha strategy) and US$65 billion in All Weather, a diversified beta strategy/risk parity portfolio. Bridgewater began investment operations in 1975, and is a pioneer in risk budgeting and the separation of alpha and beta, managing Portable Alpha/GTAA, Hedge Fund, Optimal Beta/Risk Parity, Currency Overlay, Global Fixed Income and Inflation-Indexed Bond mandates. Bridgewater manages these portfolios for a wide array of institutional clients globally, including public and corporate pension funds, foreign governments and central banks, university endowments and charitable foundations.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of investment management, asset and fund administration, banking solutions and fiduciary services for corporations, institutions and affluent individuals worldwide. Northern Trust, a financial holding company based in Chicago, has offices in 18 U.S. states and 16 international locations in North America, Europe, the Middle East and the Asia-Pacific region. As of September 30, 2012, Northern Trust had assets under custody of US$4.8 trillion, and assets under investment management of US$749.7 billion. For more than 120 years, Northern Trust has earned distinction as an industry leader in combining exceptional service and expertise with innovative products and technology. For more information, visit www.northerntrust.com or follow us on Twitter @NorthernTrust.
# # #