EdTalks on Treasury Portal Trends
Former ICD Portal Principal and EPBCOMMS Founder Ed Baldry released the first episode of a new "Ed Talks" podcast series earlier this month. He discusses "Treasury Portal Trends," and "breaks down the corporate treasury portal marketplace covering: Goldman Sachs, BONY Mellon, State Street, ICD, Sungard, BlackRock, J.P. Morgan & NEX." (The comments appear to come from our European Money Fund Symposium in Dublin, where Baldry spoke.) He tells us, "The portal industry is continuing to grow. It's getting stronger, there's further adaption for the portals with different financial industry players and corporate treasurers. We reached out to all the most notable portals and asked them for some comments and some feedback.... We'll start with BNY, which is the world's largest, and the world's largest custodial player State Street. I put them in a similar category because they're both omnibus platforms. Typically in a custodial environment, the consumers that are using it are not disclosed to the fund companies. So, from a competitive standpoint, we didn't see BNY or State Street too often ... calling the large corporates, which was a focal point for ICD, because they tend to fish in their own waters. If they have large custodial clients, prime brokerage clients, that have everything at BNY, their portal solution is very elegant because it's linked right to your custodial account." Baldry adds, "They're still very formidable players, and with the size of their custodial organizations they're going to continue to be formidable. Goldman Sachs ... they've been very active in the corporate net buy space and that really has happened in the last couple of years. They've been offering aggressive tech credits. The high level on a tech credit is an amount of money that's shared back by a portal towards a technology vendor. So for example, if you were utilizing SunGuard and you have a million dollar SunGuard software bill, they might offer you a teach credit of $100,000 if you have X or Y balances in money funds through their system. So, the tech credit concept has been proliferating most of the portals, if not all of them are operating some form of tech credit now. Those monies can't go back to the client, those monies need to be paid to a technology vendor, because otherwise it would be deemed sharing commissions preferential treatment for one shareholder versus another. So, that's a very careful line that people are tip-toeing around with the tech credits."
