BNY Mellon, one of the largest asset managers in the world, has taken concrete steps to remedy its net asset values (NAVs) system, which abruptly broke down last week after a debilitating malfunction.
Last week, BNY Mellon suffered a breakdown in its NAVs system, following a botched software upgrade from SunGard’s InvestOne accounting system. The malfunction placed several billions of dollars worth of accounts and trades in a serious state of disarray, with major price discrepancies potentially seeing the purchase and sale of funds at less than accurate prices.
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However, following several days of backlogging and reconciliation of funds since last week, BNY Mellon expects to finally resume its NAV function in its entirety ahead of the US open Monday. Following the fix, US mutual funds and exchange-traded funds (ETFs) will be again be able to be calculated and settled correctly.
Given the latitude of its business, the glitch at BNY Mellon was estimated to have affected nearly 5% of US mutual funds and ETF trading last week, totaling around $404 billion in assets. The group’s initial estimates of a fix that would taken only a couple days were drastically lengthened last week, after BNY Mellon had to work with both fund managers and regulators to run through its through a backlog of unvalued assets.
According to BNY Mellon’s CEO, Gerald Hassell in a recent conference call on the resolution and state of its systems, “We expect to complete Friday’s NAVs for all but one of the affected fund clients by tomorrow morning … Our goal is to provide fund clients with system-generated NAVs for Monday.” Mr. Hassell did not elaborate on the lone fund left unattended.