NETHERLANDS- ABN AMRO Bank and Mellon Financial Corporation are formalising their current marketing alliance by launching a new, separately-capitalised financial services company that will provide global custody and related services to clients outside of North America.

Domiciled in the Netherlands, the 50:50 joint venture will have a London office and will employ approximately 300 people. Neither party would disclose how much they are investing in the project.

The new entity, which is subject to regulatory approval, will operate with a banking licence and be regulated by De Nederlandsche Bank, the Central Bank of the Netherlands.

ABN Amro and Mellon entered a marketing alliance in 1998 and have since built up a total of e250bn is assets under custody from 111 clients.

Nadine Chakar, managing director of the existing alliance, has been named as chief executive of the new company which will be known as ABN AMRO Mellon Global Securities Services

In addition she will head a managing board responsible for executive management. This will be overseen by a supervisory board consisting of four representatives from both parties.

Jim Palermo, president of Mellon Global Securities Services, said: "the agreement to establish a legal entity will demonstrate our mutual commitment to our clients, employees and the custody business."

ABN Amro’s head of global transaction services Robert van Paridon said: "the decision to form this new company sends a clear signal to the market: both ABN AMRO and Mellon are fully committed to the custody industry, and we intend to become an even more successful player in the global custody marketplace."

Neither party would comment on rumours that they were lining up to buy Deutsche Bank’s European custody business.

In the past three years the alliance has taken on large clients such as the Netherlands’ civil servants’ fund ABP. In March, Ireland’s National Treasury Management Agency appointed ABN Amro Mellon as global custodian to the e8bn national pensions reserve fund .

The venture is similar to Mellon’s existing agreement in Canada with CIBC. Mellon and CIBC will continue to cover north American custody.

ABN Amro and Mellon have recently completed a number of deals. Last year they acquired Eagle Investment Systems, an American developer of web-based financial software.

Earlier this year, Mellon’s partnership with Frank Russell bought the financial data company CAPS, a move that has made it one of Europe’s largest suppliers of performance measurement services.


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