UK – State Street and JP Morgan are the losers in the battle for a £12bn (€17.5bn) custody mandate awarded to the Bank of New York by Capita Financial Group following a consolidation of contracts.

A Capita spokesperson told IPE that the Bank of NY, JP Morgan and State Street had previously all provided trustee, depository and custody services.

However, a decision by Capita to “consolidate contracts with a reduced number of suppliers” saw Bank of NY win the mandate to provide all these services to the underlying funds that Capita administers on behalf of its clients.

The scope of the agreement involves roughly £12bn of assets, which represents approximately 85% of Capita Financial’s current assets under administration, said the Group.

It added that the Bank of NY would also provide technology and service infrastructure.

Capita told IPE that the tendering process – involving eleven players – started in June 2005 and ended in September. This is the first public announcement of the deal.

The adviser in the process was Winchester White

The Capita spokesperson stated that the consolidation resulted in increased cost efficiencies, “which could enable us to reduce fees to some of our clients”.

The Capita Financial Group – which includes Capital Financial Administrators and Capita Financial Managers - provides administration systems and skills for fund managers and collective investment schemes. It is one of the largest fund administrators in the UK.