Trust Company outsources SMA business
Trust Company has outsourced the management of its self-managed accounts (SMAs) business to specialist manager Next Financial.
Trust executive general manager Assyat David confirmed the two companies have signed a heads of agreement, which is expected to be formalised by the end of this month.
Under the agreement, Next will become the manager and administrator of the SMAs and Trust will remain the responsible entity for the next 12 months.
David said the SMA business will continue to be promoted under the Trust banner for the next 12 months and will continue to use the same PDS.
“At the end of the 12 months the agreement will be reviewed, but we are looking at the future to ensure we offer a competitive product for the years ahead,” she said.
“The reason we choose to work with Next is because it is a pioneer in SMAs and is one of the leading providers, with more than $150 million in funds under management.”
Trust’s SMA business has about $37 million in funds under management.
David also said the company had decided SMAs were not a core business.
“We recognise SMAs have a great future in the Australian market,” she said. “But Trust is not in the market of system platforms — our expertise lies in the areas of trustee, fiduciary, investment management and advice areas.”
David said another attraction for the move was that both companies use the same management systems for their respective SMA businesses so the transition would be smoother.
“This option offered the least disruption to our clients and they will benefit from Next’s management skills as SMAs are their core strength,” she said.
Next was formed in 1998 and originally only targeted high-net-worth investors for its products. However, it now offers retail SMAs to a number of dealer groups and financial planners.
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