Italian funds drop custodian after acquisition led to conflicts of interest

Pension funds Previmoda and Byblos told Global Pensions that besides having a custodian mandate in place with MPS, they also had asset management mandates in place with Eurizon - a money manager owned by ISP.

Following ISP's acquisition of MPS, the two funds decided to replace MPS with Société Générale Securities Services (SGSS).

Previmoda allocated €350m (US$511m) to SGSS in June, and Byblos moved €300m in March, SGSS reported today.

SSGS said they have received two more custody mandates from Italian pension funds since the beginning of the year.

FON.TE has awarded €800m to SGSS and Priamo, €450m. According to data by AP Information Services, FON.TE has MPS as custodian, while Priamo had ISP.

SGSS has been consolidating its position in the Italian market since its purchase of UniCredit's securities services business three years ago.

Officials at ISP were unable to immediately comment on the matter. FON.TE and Priamo could not be immediately reached for comment.