CLIENT STORY
MN ADDS
CLIENT VALUE WITH
ROBUST INVESTMENT
MANAGEMENT
SOFTWARE SOLUTION
How MN boosted its private equity and real estate business
with SimCorp’s integrated Alternative Investments solution.
Client Story | MN
2
MN UPGRADES
ITS ALTERNATIVE
INVESTMENTS OFFERING
An integrated SimCorp solution helped MN deliver more transparency,
flexibility, and value to its alternative investments offering. As a result,
MN can service client demands more competitively and efficiently.
IN SEARCH OF A RELIABLE ASSET
ADMINISTRATION SYSTEM
Dutch pension administrator and asset manager MN
wanted to administer its private equity (PE) and real
estate (IOG) investments with a more dedicated,
reliable and service-oriented system, in the process
of moving away from a heavy internal reliance on
Microsoft Excel. Explains Timo Zomerdijk, Head of
Valuation, Reporting & General Ledger, MN: “As Excel
was not a preferred system for administration, we
started to search for a complete and solid system to
administer both investment segments so that data
could be derived from the system in a structured and
orderly way.”
DETAILED REPORTING AND AUTOMATIC
VALUATION AS KEY DRIVERS
The proof-of-concept consisted of the full administration of six MN funds, three of which were private equity and three real estate funds, including basic reporting. End-users of the PE and IOG business segments
approved the proof-of-concept in June 2011, which
marked the actual start of the project.
The requirements for the new administration were
analysed and based on the MS Excel administration
of the IOG segment. Adds Timo Zomerdijk: “Besides
the transaction administration, detailed reporting and
automatic valuation based on transactions were the
main drivers.”
MN’s main requirements were that the solution could
create reports, make calculations and store all static
data at both fund level and underlying level (building
and company level). Timo Zomerdijk: “For us, it was
not a question of reducing costs; it’s an investment in
quality, more and better data, up-to-date data, accessible data and also for the fund manager to run his
portfolio more efficiently.”
SimCorp demonstrated the solution and MN saw that
all the requirements could be fulfilled. In the project
phase, extra requirements emerged and SimCorp
had an answer for each and every need as it arose.
Either the solution was known in advance or else was
referred to SimCorp to get it fixed, which proved an
invaluable experience for MN.
A SimCorp client since 2002, MN looked to its current
investment management software business partner for
a solution. Following a presentation in May 2011, SimCorp
was asked to initiate a proof-of-concept. This was based
on SimCorp Dimension’s Alternative Investments solution, enhanced with the latest features and designed to
handle private equity and real estate investments.
The project’s configuration phase ran from July to
end-November 2011, followed by testing in December
and January 2012. Three weeks into 2012, the new
functionality went into production by converting the
funds from the original Fund Certificate administration
in SimCorp Dimension to the detailed Alternative
Investments functionality.
MN had worked with SimCorp on several occasions
before, and felt comfortable and secure in drawing on
the accumulated skills, know-how and experience that
SimCorp’s specialist consultants had to offer in the
area of project collaboration.
Client Story | MN
3
Timo Zomerdijk, Head of Valuation, Reporting & General Ledger, MN: “The SimCorp solution met all our system service requirements.
As it can also communicate with our main asset management administration system (SimCorp Dimension), the choice was easily made.”
REGISTERING TRANSACTIONS MORE EFFECTIVELY
AND FLEXIBLY
The new method of administering its alternative
investment transactions with dedicated transaction
codes and screens enables MN to register each transaction in more detail, and with a payment attached
directly to each transaction. These payments are then
approved and ultimately reconciled with the immediate business transaction attached to it. At a later
stage, payments will be automated and netted by use
of SWIFT instructions.
Also, a number of fee types like management fees
that could only be registered as part of a capital call
earlier can now be registered separately; the flexible
definition of these expense (and income) types ensures that every type of fee can be registered separately in SimCorp Dimension.
GENERATING ADDED VALUE FOR CLIENTS
The new administration allows for more detailed information to be registered. Not only do the funds that
MN invests in on behalf of its clients contain useful
information; the investments in buildings and companies by those funds provides detailed information that
can be used for an analysis of the investments per
country, region or sector, across all funds.
This information is very valuable for MN and its clients.
Timo Zomerdijk: “This information enables us and
them to see our and their exposure on a more detailed
level and then to act on it.” Setting up the funds and
their underlying investments in this way prepared MN
for the Fund Decomposition functionality added in
one of the releases SimCorp Dimension provides clients twice a year to continually upgrade and enhance
its product and service portfolio.
CREATING DETAILED REPORTS BASED
ON ONE DATABASE
Having all transaction information and fund data in
SimCorp Dimension allows MN to create a number
of more service-oriented reports, all based on one
database. Reports can now be generated directly
from SimCorp Dimension, as opposed to constructing
reports based on several spreadsheets. These reports
contain a number of key ratios like Internal Rate of
Return, Total Value to Paid-In, etc.
Having a solid and up-to-date overview of all the
private equity and real estate portfolios without comparing and merging Excel sheets is one of the gains
achieved by MN. As Timo Zomerdijk states: “Running
just one system enables all the information to become
accessible to all the relevant departments: the settlement and valuation departments, financial reporting,
not to mention the fund manager.”
AUTOMATING THE VALUATION PROCESS
Another key business driver for MN was valuation.
Private equity and real estate fund managers tend to
update their investors each quarter with regard to the
value of investments in funds. This invariably means
the value of the funds is not known in between the
quarters.
Client Story | MN
4
“The bottom line is that we now have an easy-to-use and accessible
system that can produce at any time of the day an overview of all our
private equity and real estate investments, with the latest valuations,
investment regions, businesses, investment managers, called/outstanding commitments, and more.
TIMO ZOMERDIJK
Head of Valuation, Reporting & General Ledger, MN
By using the Alternative Investments solution, MN can
take into account for valuation all the relevant transactions conducted during each quarter (i.e. capital
calls, capital returns, fees, dividends, etc.) to generate
up-to-date figures between end-of-quarter dates. This
process has been automated in SimCorp Dimension,
adding flexibility and ensuring that every transaction
triggers an update of the market values where even
back-dated changes are taken into account.
QUICK AND EASY ACCESS TO ALL DATA
To allow its fund managers and middle office quick
and easy access to all data, MN also opted to install
SimCorp’s Portfolio Workbench solution, which provides for:
For MN, choosing the Alternative Investment solution
to complement its in-house use of SimCorp Dimension
as the main asset administration system has proved to
be a highly flexible solution, well suited for cash flowbased investments, such as direct investments, private
equity fund investments, and real estate investments.
As Timo Zomerdijk sums it up: “The bottom line is that
we now have an easy-to-use and accessible system
that can produce at any time of the day an overview of
all our private equity and real estate investments, with
the latest valuations, investment regions, businesses, investment managers, called/outstanding commitments,
and more.”
•Up-to-date market values per fund or even per
underlying company
•Fund types and fund strategies
•Geographical and sector distributions
•Key ratios
Access to these up-to-date figures, combined with
graphical tools and pivot tables, provides additional
value to MN’s fund managers when they assess the
investments and improves communication with clients
when it comes to evaluating their investments.
A HIGHLY FLEXIBLE AND ACCESSIBLE SOLUTION
Implementing a new solution required a thorough
look-through methodology. As is typical in project
work like this, MN had a lot of questions and, as its
business partner, SimCorp was there to assist in finding all the right answers. With the constant on-site
help and advice of SimCorp consultants, MN found
the solutions it sought in speedy and effective project
implementation.
Name: MN
Headquarters: The Hague, The Netherlands
Industry: Pension administrator and asset manager
Business: Pension administration and investment
management
AUM: Over ¤90 billion
Website: www.mn-services.com
Client Story | UNIQA
5
CLIENT STORY QUICK FACTS
CHALLENGES
•Replace old system to administer private equity
(PE) and real estate (IOG) investments in a more
dedicated, reliable and efficient way
•Move away from heavy reliance on Microsoft Excel
spreadsheets
•Find a sophisticated and service-oriented device to
support alternative investments
•Satisfy reporting needs of external clients and
internal stakeholders (i.e. fund managers and
senior management)
OBJECTIVES
•Adopt more detailed administration with sectoral
and regional distribution of all funds (decomposition)
•Implement improved reporting and automatic
valuation mechanisms
•Set up cash flow registration (transparency of fees)
•Design future-proof solution (reporting in-house)
•Benefit from prior experience with SimCorp service
implementation practices
SOLUTION
•A single fully integrated solution meeting all criteria
– both present and future
•Convincing proof-of-concept with solution
designed for specific needs
•Flexible portfolio workbench tool for front- and
middle-office users
•On-line tool with key ratios and positions for full
access to all data
FEATURES AND BENEFITS
•Commitment transactions: holding without any
cash flow
•New balances for commitment, unpaid commitment and called capital
•Dedicated transaction windows and transaction
codes – income and expenses freely definable
•Market values instead of nominals
•Cash directly linked to the investment – no single
payment transactions anymore
•Registered in one database, available for in-house
reporting (future-proof)
•Prepared for automatic payment instructions
(and netted)
ABOUT MN
MN is one of the largest pension administrators and asset
comprehensible and affordable pension scheme. MN
managers in the Netherlands. Pension administration and
manages assets worth over ¤90 billion for a wide range
investment management comprise MN’s core activities.
of pension funds in the Netherlands and in the United
With over 60 years of experience in these areas, MN assists
Kingdom. Apart from corporate headquarters in The Hague,
its clients with extensive knowledge of the Dutch pension
Netherlands, MN has offices in Amsterdam and London.
system. Some 1,000 dedicated employees ensure that
nearly two million Dutch nationals are supplied with a
More information at www.mn-services.com.
ABOUT SIMCORP
SimCorp provides integrated, best-in-class investment management solutions
to the world’s leading asset managers, fund managers, asset servicers, pension and
insurance funds, wealth managers and sovereign wealth funds. Whether deployed
on premise or as an ASP solution, its core system, SimCorp Dimension, supports
the entire investment value chain and range of instruments, all based on a marketleading IBOR. SimCorp invests more than 20% of its annual revenue in R&D, helping
clients develop their business and stay ahead of ever-changing industry demands.
Listed on NASDAQ Copenhagen, SimCorp is a global company, regionally covering
all of Europe, North America, and Asia Pacific.
For more information, please visit www.simcorp.com.
ONE SYSTEM FOR A COMPLEX WORLD
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