Eighty-one percent of global pension funds in a State Street Corp. survey said they're looking to bring more middle-office money management functions in-house over the next three years, and 43% expect to expand the use of technology and software platforms.
Among the tasks that pension funds are considering managing internally are trade order management, portfolio accounting, alternative fund administration and maintaining an investment book of record.
“While the largest and most sophisticated (pension) funds can handle most aspects of multiasset-class portfolios in-house, the majority of pension funds will need to make a choice about where to be a specialist and when a subcontractor is needed,” said Martin J. Sullivan, senior vice president and head of asset owner sector solutions for North America at State Street.
Forty-two percent of the 134 respondents were from the Americas, 36% from Europe, Middle East and Africa, and 22% from Asia-Pacific. Fifty-two percent were executives at public pension funds, 32% were from corporate plans and 16% were from superannuation funds. Both defined contribution and defined benefit plan executives were surveyed.