BNY Mellon Investment Management's (BNY Mellon IM) decision to combine three of its largest boutiques into one asset manager is not a cost-cutting play but a reset for growth, the company has said.
BNY on Monday outlined plans to merge Mellon Capital Management (MCM), Standish Mellon Asset Management (Standish), and The Boston Company Asset Management (TBCAM) in a move that will create a new asset manager that will rank as one of the 50 largest in the world, with $560 billion in assets under management.
‘This is not about cost cutting, this is about re-investing for growth. While there are synergies on the operational side in terms of systems and consolidation etc., we are re-investing those savings into the front office, into the investment team and capabilities,’ Des Mac Intyre, chairman and chief executive of the newly-formed entity, told Citywire.
Mac Intyre most recently served as head of investment process oversight at the world's largest hedge fund Bridgewater Associates, from March 2016 to April 2017. He rejoined BNY Mellon specifically to run the newly formed entity.
Mac Intyre said the merger could lead to some restructuring and result in job cuts on the operational side where there are overlaps.
However, he said the firm would add more staff on the investment side over the next two years.
Led by Jeff Zhang from MCM, Dave Leduc from Standish and Dave Daglio from TBCAM, the combined firm currently has over 300 investment professionals in place.
Mac Intyre said the new asset manager, which will operate under a single brand later in 2018, would not lead to current teams changing their investment processes and that no funds would be scrapped as a result of the merger.
Instead he said new products would be rolled out over the next two years.
‘There is really no overlap in the product. It’s unique and it’s complementary and it makes this combination uniquely viable and easier to implement,’ said Mac Intyre. ‘You’ve got all the building blocks for strategic asset allocation and this potential to add other alternative capabilities.’