BNY Mellon Races to Fix Pricing Glitches Before Markets Open Monday
August 30 2015 - 03:23PM
Dow Jones News
By Kirsten Grind
Executives at Bank of New York Mellon Corp. are racing against
the clock to make it through a backlog of pricing issues before the
markets open Monday morning.
More than 100 executives at the bank worked through the weekend
to correct a software glitch that has complicated pricing for
hundreds of mutual funds and exchange-traded funds since last
Monday. The problem stemmed from a SunGard system used by BNY
Mellon that became "corrupted" last weekend after an upgrade,
SunGard said in a statement Thursday. A SunGard spokesman didn't
immediately return a request for comment Sunday.
By Sunday midday, the SunGard system was performing properly and
BNY Mellon had calculated the net asset values for all funds
through last Wednesday, with the exception of one company, the bank
said in a statement Sunday afternoon. The largest fund custodian in
the world by assets, BNY Mellon provides accounting services for
money managers.
"SunGard's system is restored and we have made significant
progress over the weekend to process the backlog," a BNY Mellon
spokesman said.
But the bank was still working through a backlog from Thursday
and Friday, and it was unclear whether it would be able to complete
the task by the time the market opened Monday, said a person
familiar with the situation.
The bank, along with fund companies, regulators and exchanges
all hoped to start the week having made it through the issue, this
person said.
The outage has been unprecedented for money-management firms,
who strive to provide investors with accurate pricing for their
funds. In its first attempt at quantifying the outage, BNY Mellon
said over the weekend that 20 mutual-fund companies had been
affected and 26 providers of exchange-traded funds.
Fund companies affected include Goldman Sachs Group Inc.,
Federated Investors and Invesco PowerShares. They have all had to
rely on backup methods for calculating asset values, and are now
reconciling the values they published last week with the new data
provided by BNY Mellon. BNY Mellon said in a statement Sunday it is
also "using alternative methods to address the backlog from
SunGard's system failures this week."
NYSE Group, a unit of Intercontinental Exchange Inc., Nasdaq OMX
Group Inc. and BATS Global Markets Inc. declined to comment.
Bradley Hope contributed to this article.
Write to Kirsten Grind at kirsten.grind@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 30, 2015 15:07 ET (19:07 GMT)
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