Dexia and Mount Street sign an agreement for the management of Dexia’s bond portfolio

  • Leo Jesus
  • February 05, 2024

Dexia and Mount Street announce that they have signed an agreement enabling Mount Street to take over the servicing of Dexia’s €17 billion bond portfolio and a team of eight bond management experts, acting as Dexia’s exclusive outsourced service provider for portfolio management services.

Under the terms of the five-year contract, Mount Street, through its regulated business, Mount Street Portfolio Advisers GmbH (“MSPA”), will undertake a range of services including asset management, trade execution, portfolio market data and valuation, and strategic advisory. The €17 billion Dexia portfolio comprises of a range of bonds, financial instruments and credit products from issuers in the public finance, local municipality, utility, social housing and related sectors, across various jurisdictions in Europe and North America.

The new mandate builds on Mount Street’s established outsourcing track record and role as portfolio manager-of-choice for blue chip institutions. In 2017, it completed the successful acquisition of EAA Portfolio Advisors, from Erste Abwicklungsanstalt, which included the management of €22 billion of funds. In February 2022, Mount Street was appointed by Aviva Investors to provide debt servicing functions on a portfolio of £30 billion. In 2023, in its role as independent portfolio manager for Helaba’s HLB Private Markets Platform, it supported the fund-raising strategy for Helaba’s “Infrastructure Debt Fund I”.

The transaction between Dexia and Mount Street enables Dexia to pursue the management of its loan and bond portfolio in run-off with a solid partner and in an orderly manner for the ensuing years. Anchored with Mount Street, Dexia will be able to rely on the strong expertise of its Dublin-based bond portfolio managers while giving them new career perspectives within the Mount Street Group.

Stephan Plagemann, Chief Financial Officer at Mount Street, commented: “Having established a strong relationship with Dexia over the past six years, this appointment is a significant milestone in our legacy portfolio outsourcing capabilities. There remains a need for institutions in resolution to review their structural set-up from time to time as the underlying portfolios are scaled down, while still having to satisfy the requirements of their various stakeholders. We are very excited to have the opportunity to partner with Dexia and provide innovative solutions throughout this process.”

Pierre Crevits, CEO at Dexia, commented: “I am delighted with this agreement with Mount Street, a very experienced and recognised player in the field of portfolio management. This partnership reflects Dexia’s desire, within the context of its orderly resolution, to ensure a future for its bond portfolio management experts within the Mount Street Group while at the same time securing the continuity and quality of its portfolio management services.”