Accenture launches STP venture for asset management community

Sacked chief of Australian financial services giant AMP named as CEO of new joint venture Encompys.

Accenture has joined with Advent Software, Compaq, Microsoft and the Bank of New York to create Encompys, an independent company offering outsourced straight-through processing (STP) solutions for the global asset management community.

Encompys evolved out of the WEBeSTP program at Accenture, formerly Andersen Consulting. It’s first client, global fund manager PIMCO, signed on last year before Accenture’s partners in the venture were named.

The venture aims to provide a single point of entry for all pre-trade, trade and post-trade activities, enabling asset managers to focus on their core competencies of investment management and client relationships while helping to reduce the time, cost and risk associated with securities trading and settlement. Encompys will offer asset managers an alternative to building their own T+1-compliant systems or integrating separate components internally.

James P. Honohan, the Accenture partner responsible for launching Encompys, has been named president of the venture, while George R. Trumbull has been named chairman and chief executive officer.

Trumbull was formerly chief executive of Australian financial services giant AMP, but the American ended his five-year stint down under on a bad note when his contract was terminated in August 1999. A dispute ensued over the terms of the dismissal, which ended with Trumbull receiving a payout of A$13.2 million ($6.7 million) - the largest payout of its type in Australian corporate history.

Trumbull had successfully steered AMP through its demutualization and share market listing, but in December 1998 he launched a bitter hostile takeover of GIO, which subsequently reported a loss of A$1.1 billion following a spate of large insurance claims.

These losses pushed AMP into the red and caused its share price to slump. In the ensuing media attention Trumbull was reported as labelling the local business community "yellow-bellied Australian cowards", "sons-of-bitches" and "freaking liars", and was promptly dismissed by AMP’s chairman.

Whether any bad blood remains that might affect Encompys’ prospects in the Australian market is a matter for conjecture, but a representative of one asset management company says it is unlikely that a business decision would be made on anything but the quality of the STP solution and price.

Accenture will serve as consulting services provider to Encompys, focusing on business and systems integration and construction of the client relationship management functionality; Advent will furnish the core applications; Compaq will provide ProLiant servers and related hardware; Microsoft will supply the system software and Internet portal applications; and The Bank of New York will deliver middle- and back-office trade execution, securities servicing support and master record-keeping services.

The combined total investment of the partners at launch, exclusive of service provider agreements, is approximately $50 million. No further financial details have been announced.

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