UK - The 18 billion-pound (26.8 billion-euro) Electricity Supply Pension Scheme has widened its mandate with the Bank of New York, in a deal which will see up to 15 staff transfer to the bank.
Scheme chief executive Richard Barlow told IPE the move would involve “more than 10 and less than 15” staff. They will transfer in a phased way in July and August – timed “to fit in with the financial year-end”.
“There will be cost savings,” Barlow said, adding that the scheme would be able to benefit from the bank’s straight-through-processing technology. He declined to say how much the scheme would save.
The staff will move from Southwark in central London to the bank’s offices in Canary Wharf, in the Docklands area east of London. He said there were mixed views from staff about the decision, but on balance the response was positive.
The bank, currently the scheme's master global custodian, said it has been appointed to provide investment accounting and compliance services in addition to its custody role. No financial terms were disclosed. Barlow said the initiative came from the bank.
"We chose to widen our mandate with the Bank of New York because it has demonstrated its commitment not only to global custody, but also to the UK pension fund sector," Barlow was quoted as saying by the bank.
He was quoted adding: "We are confident that the bank will continue to maintain and improve our risk controls and provide us with high quality service, both of which are of critical importance to our members."
Tim Keaney, executive vice president and head of Europe at the bank, said: "This appointment by one of the UK's major pension schemes underscores our expertise in investment accounting and compliance reporting and demonstrates our ability to provide value-added services deriving from our master custody role.
"It is a natural extension of our 20-year relationship with ESPS and a wonderful endorsement of the services we currently provide to them."
Barlow added that the scheme took advice from its regular advisors Deloitte & Touche and PricewaterhouseCoopers – though it hasn’t employed a change management contractor. Project management would be done in-house.