Industry Updates

J.P. Morgan expands prime custody service to hedge fund clients

Monday, December 05, 2011

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Opalesque Industry Update: Less than a week after signifying that its banking division would cancel its hedge fund accounts, J.P. Morgan Chase has announced it is planning to expand its prime custody service to hedge fund clients of its European Prime Brokerage business using a fully integrated platform.

According to a report by Asset Servicing Times, J.P. Morgan’s prime custody service uses a bank custodial account that enables clients to separate securities. This also takes advantage of the firm’s prime brokerage offering capabilities that are delivered using a fully integrated product suite.

The integrated platform enables the swift movement of securities between custody and prime brokerage accounts, as well as consolidated reporting and a single client-facing technology. The platform offers a dedicated client service representative that supports all products.

J.P.Morgan’s global head of prime custody Devon George-Eghdami, said, “Our Prime Custody service has been supporting US hedge fund managers for over ten years and it is this experience that is invaluable in today’s market. We are focused on meeting the demands of hedge fund managers who seek a provider that offers flexible solutions, has a strong capital base and experience managing risk during volatile times.”

Last week, Barry Ritholtz’s Big Picture reported that JP Morgan’s business banking divisions had announced plans to terminate its service of providing any financials to its hedge fund or private equity customers.

The web site reportedly posted a letter from J.P. Morgan indicating that all of the accounts would be discontinued beginning December 19, 2011. The bank would send checks to clients after the said date, the report said.

Precy Dumlao

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