US — Asset managers and institutional investors view back-office capabilities as an increasingly important area when selecting dealers for fixed-income trades, a study by Greenwich Associates and The Asset Managers Forum has found. According to the research, nearly half of US asset managers said operational capabilities already played some role in deciding whether to work with a given dealer, while nearly 60% reported back-office criteria were becoming more critical in their dealer selection processes, said Tim Sangston, Greenwich Associates consultant. "With pricing becoming more consistent, asset managers and other institutional investors are increasingly able to direct business to those dealers that provide value away from the sales desk," said Sangston.
In this environment, operational capabilities and other qualitative measures were taking on a much higher profile, he said. As part of ongoing initiatives to address shortcomings in sell-side back-office performance, many survey respondents said they were taking steps to increase the importance of operations in the process.
Several participating asset managers had begun meeting on a regular basis with their dealers to discuss level of service, standards, and escalation procedures.
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