NAV (純資産価値) 管理と偶発事象へのCOVID19の影響についての考察

The fallout of the Covid-19 pandemic is likely to have ramifications in a number of areas within capital markets, for example shift to remote working, but asset managers (AMs) have had a somewhat unexpected change; the pandemic has changed perceptions on the role of the fund administrator and outsourcing. This has led to an increased demand for net asset value (NAV) oversight and contingency tools. While the situation is still evolving, Celent has observed three takeaways.

1. Oversight Matters

Traditionally many AMs have dismissed the importance of NAV pricing and oversight processes as it is a “non-alpha generating activity”. However this has changed. In March AMs were faced with unprecedented market volatility. Celent spoke to 22 senior operations executives at a selection of AMs, some of whom attested that their fund administrators faced strain from large price swings which increased the risk of a delayed or inaccurate NAV calculation. A pricing error could pose significant reputational and financial damage for firms.As a result, AMs were forced to better understand the frequently overlooked and often opaque process of striking the NAV. Investing in oversight tools that could detect errors before costly reconciliations was no long a “nice to have”. It was a “need to have”.

2. A Component Based Outsourcing Model Is Becoming More Popular

Pandemic-related disruption to NAV pricing services has increased attention on the role and value of the fund administrator. This has prompted AMs to further question the conventional single outsourced model for fund administrators. Over the past few years AMs have had made increasingly complicated demands while at the same time searched for ways to cut costs. To put it simply: many portfolios are becoming too complex for a single fund administrator to be able to fully cover the AM’s needs. Some AMs now want providers who can price geographically dispersed assets. Others are searching for intraday oversight validations and data analytics capabilities. In addition, many are looking for offerings that support specialized products in the increasingly popular ESG and passive ETF spaces.

3. A Contingent NAV Is Now Part of BCP

While some AMs employed oversight tools, few understood the value of contingency capabilities prior to the pandemic. Contingency tools are defined as those which can strike a functional back-up NAV in the event of a fund administrator outage. One SVP at a Tier 1 AM told Celent, “Why in the world would I pay for a second fund administrator if I already have one?” However during the last year, the value of contingency offerings has become increasingly clear. Owing to extreme market volatility, and government mandated shutdowns, NAV solution providers have claimed there have been several recent instances where a fund administrator outage or delay has disrupted the striking of the primary NAV. This has led to potentially significant operational risks. Thus it has become evident that AMs should view back-up NAV tools as a part of business continuity planning (BCP). The associated increase in cost can pale in comparison to the damage that a fund administrator outage can cause both in terms of reconciliations and reputational risks.

Upcoming ABCD Coverage

To address increased client interest and highlight recent technological advancements within NAV Oversight and Contingency tools, Celent will be publishing an ABCD vendor view in 1Q 2021. This is a standard representation of the vendor marketplace designed to show the relative positions of each vendor in four categories: Advanced and agile technology, Breadth of functionality, Customer base (i.e., relative number and distribution of customers), and Depth of client services.