A US-based public pension fund with USD 100B+ AUM moved to SimCorp’s middle-to-back SaaS platform and Data Warehouse. Now three years later, their accounting team has reclaimed at least one week a month for value-adding tasks.

The situation

In 2018, the fund, one of the largest in the US, found itself constrained by a legacy system that did not support their vision to consolidate and optimize investment operations across all asset classes. That’s when they recognized the necessity of transitioning to an integrated investment management solution. 

One system, disparate products, and limited resources: Does this sound like your firm?

While the fund had previously operated on a single system, its provider lacked full integration with their data warehouse, forcing them to execute intricate manual reconciliation processes. Additionally, the system provider had to work with its parent organization, a large financial institution, to receive master-record keeping services including performance, plan accounting and compliance. This, in turn, resulted in potential data risks. The combination of in-house back office processing and outsourced middle office functions, complexity around environment and configuration changes, and limited staff to run the application resulted in increased costs for the operational framework, leading to dissatisfaction with the rising expenses and the quality of service.

Our Investments IT team used to be focused on keeping our various systems running and fighting regular processing fires. Now they lead new implementation work and consult proactively on the strategic needs of our business. They are smaller but far more valuable.

Investment Accounting, Operations and Compliance Executive

The solution

By transitioning to SimCorp Dimension, SimCorp's SaaS platform, and our Data Warehouse, the fund achieved significant cost savings compared to what they would have spent had they continued using their legacy system. 

The business benefits

The integration of investment processing capabilities across the fund’s middle and back office eliminated the need to reconcile data between the different parts of their system. This consolidation also allowed the fund to process all instrument types, including alternatives and derivatives in one system, and helped streamline their month-end closing. Prior to implementing SimCorp Dimension, the month-end closing process consumed the entire team of eight investment accounts and resources from other internal teams for at least eight business days. No other work could be initiated during that window. Now, each investment accountant spends one to two business days on the process and new, value-added work takes place even during the month-end closing window.   

  • The adoption of SimCorp's SaaS solution significantly improved accounting practices, enhancing automation, agility, data quality, and reporting capabilities. Additionally the fund gained 24x7 support, reduced time-to-market for upgrades and testing services, mitigated risks, and increased scalability. 

SimCorp's adherence to the SOC2 TYPEII international security standard addressed a significant security risk for the fund, eliminating the need for additional security measures. SimCorp's security best practices, including penetration testing, access management, cloud data protection, vigilance, and resilience, align seamlessly with the fund's needs and regulatory requirements, covering the entire application stack and not just the infrastructure. 

Consequently, the fund experienced a 30 percent reduction in internal IT staffing supporting investments, since those resources were reallocated to other areas. 

The successful partnership between SimCorp and the fund has expanded to now include SimCorp's Collateral and Compliance Manager. They have upgraded from Validation & Testing to Continuous Testing Services and extended their SimCorp Dimension subscription for another two years, highlighting the value of SimCorp's solutions.