Monthly Archives: March 2017

Eagle & BNY Mellon: Defining “Pragmatic” Innovation

Through leveraging existing technology assets across BNY Mellon Eagle’s relationship with its parent company facilitates collaborative, business-led innovation

Dan Cavanaugh, Head of BNY Mellon Program Services


Technology and digital innovations hold the promise of new and better ways of doing business, creating efficiencies that often leave users wondering how they managed any other way. Startups that either leverage or advance these technologies are being launched daily, and while these fledgling efforts often garner the bulk of industry headlines, most fail to live up to the hype. Depending upon how one defines failure, Harvard Business School’s Shikhar Ghosh has estimated that as many as 90% to 95% of all startups ultimately fail to reach their stated expectations. The challenge, as many discover, is that commercial success requires far more than just a good idea and an initial round of funding.

This is not to say, however, that the market is not hungry for new solutions. While early stage venture will remain a hit-or-miss game for many investors, the fact that FinTech companies have raised approximately $25 billion over the past 12 months speaks to the opportunity set. As financial institutions continue to cope with fee pressure, low economic growth, historic regulatory change and the coming digital revolution, the urgency to transform their operations to accommodate this new world is only becoming more pronounced. It’s more likely than not, however, that they’ll be turning to existing relationships to solve these issues.

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Assessing the New Landscape for Evaluated Pricing in Illiquid Bonds – US Muni and Corporates

Jimmy Suppelsa, COO of Eagle alliance vendor Best Credit Data (BCD), highlights why industry consolidation is opening the door for tech-driven offerings that offer quality and coverage in evaluated bond pricing.


By design, municipal bonds are a tax-efficient alternative for income investors seeking regular and predictable interest payments. This lends to the idiosyncratic nature of the muni market, as it’s the only asset class in which individual investors make up more than 50% of the investor universe. As allocations to municipal bonds often underpin individual retirement accounts, trading volume is minuscule compared to the size of the actual market. In a high-volume trading session, there may be 12,000 trades that affect less than 1% of the roughly 1.25 million active securities. This is why pricing can seem so lumpy to outside observers. At the same time, it is also why two or even three sources of pricing data are needed to arrive at a valuation that best serves a fund’s investors or clients.

In fact, most fund managers self-regulate to incorporate two independent sources of evaluated pricing data. Even in this new era of deregulation, the need for both a primary and secondary source will remain critical, as pricing is often quite volatile relative to other markets due to the lack of volume. Recent consolidation, however, has altered the evaluated pricing landscape and amid the search for alternatives, many are now exploring how new models can complement the offerings of existing players.

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