Assets under depositary increase by 54% to over $20bn
INDOS Financial Limited (“INDOS”), the UK independent depositary, has passed the milestone of undertaking depositary services for 100 alternative investment funds with assets over $20bn. These figures represent a substantial growth in the business of 37% in the number of funds (from 73) and 54% in assets under depositary (from $13bn) since end-December 2016.
Welcoming this rapid business growth, Bill Prew, INDOS CEO explained that the added value arising from the employment of an independent depositary, as opposed to a depositary affiliated to the fund administrator, was becoming increasingly recognised by fund managers, fund directors and investors.
“In many cases,” said Mr Prew, “depositary services are viewed as a tick-box subset of fund administration but this model inevitably results in conflicts of interest given that one of the key roles of a depositary is to oversee the output of the administrative function and flag up problems.”
“INDOS is responsible for reviewing each NAV calculation and providing the fund manager and the Board with regular, tailored reports,” Mr Prew added, pointing out that INDOS is actively present (either in person or via telephone) at the majority of fund board meetings. “By contrast many managers who transfer their depositary requirements to us say they had little active engagement with their (former) depositary and were very rarely notified of issues whether at their affiliated administration business or otherwise. In several cases we have identified issues following take-on that clearly existed previously but were either not identified or went unreported”.
Other factors have made an important contribution to the firm’s expansion. Originally founded to provide ‘depo-lite’ services to hedge funds as the AIFMD (Alternative Investment Fund Managers Directive) came into force, INDOS has now broadened its range to include private equity and real estate funds, some 27 of which are now clients. Since May 2017, the firm has evolved further to offer full depositary services to UK unauthorised funds such as investment trusts and has recently announced two new clients in this area.
“An important feature of the increasingly strict regulatory environment in which investment managers now operate is the responsibility to achieve value for money from all external service providers,” said Mr Prew. “INDOS has achieved the scale and industry reputation where it regularly competes as an independent depositary against affiliated providers for larger mandates, delivering a tailored, value-add and more cost-effective service to clients”.
Contacts for further information:
Bill Prew, CEO, INDOS Financial Limited +44 (0) 203 319 1590
Simon Rostron, Rostron Parry +44 (0) 7802 292 252
About INDOS Financial (www.indosgroup.com)
INDOS Financial specialises in providing independent AIFMD depositary services to alternative investment funds. INDOS was the first FCA authorised AIFMD Depositary in January 2014 and currently provides depositary services to 100 funds that have more than $20bn in assets. Clients include EU and non-EU managers managing a broad range of open and closed ended alternative investment fund strategies ranging from hedge funds, to private equity, real estate and other closed ended funds such as UK investment trusts.
The firm holds regulatory permissions to undertake both depositary-lite and full depositary business. INDOS’ team of experienced staff utilises its own proprietary DEPOcheckTM system, an integrated workflow management and automated monitoring solution to deliver efficient solutions to its clients. INDOS has been recognised as Best Depositary Solution for two consecutive years in the 2016 and 2017 HFM Service Awards.