Custodians hit the transition management trail

Custodians are bulking up their transition management teams. Recruiters say jobs in the area pay more than other custody roles, and can be an opportunity for custody staff to get some quality contact with clients.

"Transition management is an area that custodians are building up quite strongly," says Dev Majithia, manager of the investment management team at recruitment firm Joslin Rowe. "It's seen as a lucrative area to get into, and the market is growing."

State Street, the largest transition manager, is advertising for a senior operations specialist to help set up new transition accounts, and rival custodians such as Northern Trust and Bank of New York are also said to be adding staff in the area.

"Both fund managers and custodians are hiring transition staff as business increases," says Emily Ayre at recruitment firm Morgan McKinley. "Jobs have increased steadily over the past year."

Transition managers help shift assets from one fund manager to another. The business has expanded in line with growth in assets under management. State Street, for example, highlighted growing revenues from transition management as a factor in its bumper first quarter, which saw profits jump 29%.

Majitha says transition management staff can earn a premium over colleagues in roles such as Net Asset Valuation (NAV). "Salaries are up to 10% higher, and bonuses can be 20% higher," he says.

After five years, Majitha says a transition manager can command a salary of 40,000 to 50,000, plus a bonus of 20% max.

Transition management roles can be dull to the extent that they involve administrative tasks such as transferring information on client accounts. However, Ayre says they can also be a good opportunity to gain client contact: "You need to be very strong interpersonally. During the transition you'll be dealing with clients on a daily basis."