Paul Broderick: “The Cyprus office has been one of MUFG Investor Services’ biggest successes”

MUFG Investor Services' new Head of the Cyprus Office, Paul Broderick, discusses how the project exceeded expectations against the backdrop of the fund administrator hitting a remarkable milestone in 2024, exceeding US$1 trillion in assets under management.

In the early throes of 2024, MUFG Investor Services, the fund administration arm of Japan's MUFG (Mitsubishi UFJ Financial Group), smashed through the US$1 trillion milestone in assets under management, solidifying its stature as a heavyweight administrator on the global stage. Meanwhile, over in Cyprus, winds of change were gusting through the corridors of its local office. Paul Broderick, one of the first expats to join the office – which opened in 2022 – to head up operations, has been promoted as Executive Director, Head of the Cyprus Office, a role vacated by Yiannis Matsis, who is now Managing Director, Global Head of Business Promotion. Indeed, the executive shuffle reflects the stellar trajectory of the Cyprus outpost, which has surpassed expectations: what began as a blueprint for a team of 60 has burgeoned into a force nearing 200 people. “The Cyprus office is one of MUFG Investor Services’ success stories over the last couple of years,” Paul Broderick says, speaking to CBN via Zoom.

Bridging the skills gap

According to Broderick, the workforce blueprint always involved predominately hiring local talent. However, the lack of expertise on the island, given the small market size, meant that the fund administrator had to take a strategic gambit by harnessing the transferable skills from the trove of accountants, financiers and lawyers that make up the local services sector; to spearhead their training, MUFG Investor Services enlisted seasoned expats from its established offices. "I have to say, I’ve been impressed with the strong talent pool,” Broderick reflects, revealing plans to add another 50 people by the close of 2024, with the grand ambition to swell the workforce to 450 strong by the end of 2027. “Our aim is to be the employer of choice in Cyprus,” he says.

Interestingly, the allure of the Mediterranean lifestyle, with its balmy climate and seaside vistas, has exerted an irresistible charm for Broderick and the rest of the expatriates since from the 15 expats brought to the island, most have extended their contracts. Broderick also mentions that MUFG Investor Services' acquisition of Limassol-based ISFT, which brought some 55 people into the Cyprus office, “was a springboard for the local workforce numbers we experienced. It made sense to bring this in-house and be at the technological forefront because every client now is looking at how to drive efficiencies via technology. Having these capabilities internally has made us more efficient as well.”

Go forth and multiply

The meteoric growth of the Cyprus office has supercharged the fund administrator’s regional expansion plans, especially for uncharted territories like the Middle East. “It’s certainly one of these places where there’s a lot of new investment managers and a lot of exciting opportunities.,” Broderick notes.

Meanwhile, the fund administrator's success comes against the background of an ongoing conversation on where the future lies for the local funds industry. In 2021, the Cyprus Investment Funds Association set a medium-target goal to increase the assets under management to €25 billion – at the time of writing, that number is close to €10.7 billion – by attacking key funds managers on the island. However, for Broderick, the priority should be to grow the fund administration segment, since that would provide the necessary platform to attract bigwig funds. “A rising tide lifts all boats,” he explains. “Once you have this kind of platform, the whole industry will grow around it. And I fully expect that once the fund administration law is passed, other companies will see what we've done in Cyprus and want to come here – healthy competition makes for a better environment.”

A grand vision

Surpassing the monumental US$1 trillion milestone in assets under management has been primarily through organic growth – and the vision set forth by John Sergides when he took the helm of MUFG Investor Services back in 2019. This vision, Broderick says, involved redefining the role of the fund administrator into a fund solution provider. By leveraging, then, the global reach of its parent organisation -- Japan's MUFG is one of the largest banks in the world -- it was able to offer services like fund financing and FX hedging. This move not only added new revenue streams but was also instrumental for client retention; it appears that MUFG Investor Services generally doesn’t lose clients. “We look at our client relationships as a partnership. So, by looking after their middle- and back-office operational needs, they can focus on their core activities as investment managers, and generate the best returns for their clients,” Broderick notes. “It’s really been inspirational working with John. When he first started talking about our projected growth to $1 trillion in assets under administration, say five or six years ago, and where we planned to be as an organisation, I was scratching my head; these were really aggressive targets. But we are hitting them!"

Next steps

The fund administrator announced in 2024 its intention to enter the payments and cash management space, in line with its vision to provide its clients with a comprehensive suite of solutions. Broderick notes that MUFG Investor Services has also set up a dedicated AI team, with someone on the ground in Cyprus, to explore potential use cases for Large Language Models. “We don’t want to be the biggest administrator in the world, but we want to be the best, and technology will be the driver here,” Broderick stresses.