BNY Mellon on Tuesday announced the creation of a sovereign institutions group that would focus on expanding money management, securities servicing and other services among sovereign wealth funds and sovereign pension plans along with central banks and other state-owned investment organizations, said Jai Arya, who was named head of the new group.
“This is a fast-growing segment in which we wanted to look after on a dedicated basis,” Mr. Arya said in a telephone interview.
Based in Singapore, Mr. Arya will begin building a team initially with about six investment professionals. He also will chair an existing companywide sovereign advisory board.
Mr. Arya said sovereign institutions are generally “heading towards a barbell approach to investing,” which uses risk analysis to dynamically allocate between passive and active strategies. As a result, these institutions are particularly looking to outsource assets in strategies where “managers can clearly provide alpha or it is too expensive to build internal expertise,” said Mr. Arya, who was previously head of client management in Asia-Pacific.
A replacement for Mr. Arya is expected to be named later this month.