THE MONEY MANAGEMENT INSTITUTE

For: The Money Management Institute                                     

Executive Director
(202) 347-3858
Jim Marren
TorranceCo(212) 521-5210          

MMI Expresses Support for DTCC Plan to Offer

Centralized Communications System for SMA Industry

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Washington, D.C., November 10, 2003 -- The Money Management Institute (MMI), the national association for the separately managed account industry, has expressed its support for the planned launch by National Securities Clearing Corporation (NSCC) of a standardized, centralized communications system for separately managed accounts.  NSCC is a subsidiary of The Depository Trust & Clearing Corporation (DTCC).

NSCC will offer an information messaging system designed to link all participants in the separately managed account (SMA) market, including broker dealers, investment managers, technology firms, custodial firms, trust companies, operations outsourcing providers, and non-broker/dealer firms and independent advisers that offer SMAs.  The system will automate the flow of data related to establishing and servicing SMA accounts, which is now highly manual.  A rule filing seeking approval to proceed with the new service has been filed with the SEC and is pending.

In a letter to NSCC, MMI’s Executive Director, Christopher L. Davis, notes that the rapid growth of the SMA industry presents numerous challenges in the technology and operations area.  The situation closely parallels that of the mutual fund industry, which 20 years ago faced similar operational problems and growth projections.

“In the mutual fund industry, the various industry participants worked together to develop standard protocols and processes to achieve cost efficient operations that could function in a period of rapid asset growth,” the letter notes.  “NSCC played an important role in achieving the industry-wide solutions to the very similar operational problems experienced by the mutual fund industry and the industry now relies heavily on NSCC’s mutual fund services as a standardized processing and reporting platform.”

“In order to realize our full growth potential, the SMA industry will need to develop a well integrated, highly efficient common platform for ongoing account administration as well as for the creation of new accounts,” said Henry Kaplan, managing director of Morgan Stanley’s Consulting Services Group, and a member of MMI’s Board of Governors. 

Mr. Kaplan said:  “We look forward to working with DTCC in solving this challenge, thereby facilitating enhanced service for our investors and supporting growth initiatives throughout our industry.”

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Note to Editors:  The Money Management Institute (MMI) is the national organization for the separately managed account industry, representing portfolio manager firms and broker dealer firms that sponsor investment consulting programs.  MMI was organized in 1997 to serve as a forum for the separately managed account industry’s leaders to address common concerns, discuss industry issues and work together to better serve investors. The Institute is the leading advocate for the industry on regulatory and legislative issues. MMI’s membership comprises firms that offer comprehensive financial consulting services to individual investors, foundations, retirement plans and trusts; related professional portfolio management firms, and firms that provide long term services to both broker dealer and portfolio manager firms such as computer/technology firms.  www.moneyinstitute.com.