The Heads of Agreement provides a framework under which the two parties will explore connectivity of InfoComp customers, through its fund administration system, Composer, to ASX FundConnect.
Mr Mark Spiers, ASX FundConnect Project Director, said "There are a number of large fund managers who use Composer to manage their unit registry, so we see a great benefit in facilitating enhancements such as straight through processing to the software package.
"Ultimately this would make a significant contribution to delivering a critical mass of fund managers to the ASX FundConnect service," said Mr Spiers. He added that the ASX needed to work with InfoComp's customers to demonstrate the merit of adopting ASX FundConnect as their transaction processing hub.
"InfoComp's experience in wholesale and retail unit trust registry, superannuation and pensions was another key consideration," said Mr Spiers.
Also commenting on the announcement, Mr Rob DeDominicis, InfoComp's General Manager said "The alliance with the ASX offers the opportunity to work with a player who has valuable expertise in developing complex transaction processing services and has a proven track record in delivering results in the equities market.
"Working with the ASX is pivotal to ensuring our customers, such as Perpetual Investments, Credit Suisse Asset Management, Macquarie Financial Services and Merrill Lynch Investment Managers, remain competitive by being able to link up with ASX FundConnect with minimal cost or effort. Once connected, fund managers should then be well positioned to benefit from the improved cost efficiencies and quicker turnaround times that are expected."
This is the ASX's second agreement with a key service provider for ASX FundConnect, following its Heads of Agreement with IWL, announced in late May.
Mr Spiers said "Consistent with our approach to the market, the agreement with InfoComp is non-exclusive to ensure an open architecture environment. It's important that we maintain our position as a neutral player in the market and this approach serves only to protect that."
Explaining that being neutral also means not competing against its customers he said that the agreement with InfoComp demonstrates that ASX FundConnect is not planning to run a managed fund unit trust registry service. He added that similarly, "ASX FundConnect has no intention to build and run aggregation platforms or to offer portfolio and custody services."
Mr Spiers said "ASX FundConnect is a service that's not aimed to compete with its customers but to deliver them potential for lower costs, greater efficiency and improved client service. "
Discussions on developing straight through processing enhancements to InfoComp's fund administration system are expected to take two months. Following this, both parties expect to enter into more detailed negotiations on a development plan.
About ASX FundConnect
ASX is developing ASX FundConnect as a key part of its overall strategy to develop new market place services. ASX FundConnect will provide a transaction-processing service facilitating straight through processing capabilities for the unlisted managed funds and superannuation industry. The service will link the diverse range of industry participants (including financial advisers, dealer groups, brokers, fund managers, IDPS providers, master trusts, wraps, custodians and margin lenders) to enable transaction processing to be automated.
In offering ASX FundConnect, the ASX is aiming to extend the benefits of automation that have been realised for equities and other traded securities to unlisted managed funds. Since launching the service proposal to the industry in December 2001, ASX has developed detailed business requirements for the service in conjunction with the industry. It has also undertaken detailed evaluation of the technology options available for the development of the ASX FundConnect service.
The rollout of initial functionality for ASX FundConnect is planned for 2003.
About InfoComp
InfoComp provides funds management software, encompassing administration, tax compliance and unit registry functionality to a range of product providers and asset managers within the unlisted managed funds industry.
InfoComp customers include Royal & SunAlliance Financial Services, Perpetual Investments, Macquarie Financial Services, JP Morgan Investor Services, Merrill Lynch Investment Managers and Credit Suisse Asset Management.
Composer is a unique fund administration system in that it supports a wide range of product offerings: wholesale and retail unit trusts, cash management, personal and corporate superannuation as well as pensions.
