Citigroup Inc., long a provider of fund accounting and administrative services for sponsors of buyout funds, sees an opportunity to expand into services for those funds’ investors as well.
“Since the financial crisis sophisticated investors are more hungry for information,” said Massimo Zannella, director of Citi Private Equity Services. “There has been an improvement in the levels of information that GPs provide,” he added. “LPs do not necessarily have the resources to analyze all the portfolio data they receive.”
The New York bank is stepping into an increasingly competitive market for buyout fund data services, working with the The Burgiss Group of Hoboken, N.J., to provide that service provider’s online benchmarking services to the bank’s clients that invest in alternatives.
The move puts Citi in increased competition both with newcomers such as Pevara, an online system developed by eFront, a Paris-based investment benchmarking firm, which launched in November, and established players such as such as Thomson Reuters, the publisher of Buyouts, and Cambridge Associates, which also track fund performance.
And while it also would appear to put Citi in competition with rivals such as State Street Corp., Northern Trust or Bank of New York Mellon, which provide private equity services through their custody operations, Zannella said Citi’s focus is different.
“LPs are looking for subject matter expertise beyond their trustees,” he said. “We’re providing data for decision support.”
Citi is layering the Burgiss data visualization technology on top of the bank’s proprietary fund accounting engine, Citi Direct for Securities. The bank, which announced the push into LP services last month, plans both to work with existing clients and to reach out to new ones, Zannella said. “Private equity is a growth area for us at Citi.”
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