Melville-based Broadridge, part of the S&P 500 Index, said the deal expands its “ advisor compensation management capabilities.” Terms of the transaction weren’t disclosed.
Broadridge has more than $4 billion in annual revenues and provides proxy voting services to more than half of public companies and mutual funds globally.
The company processes on average more than $5 trillion in fixed income and equity trades per day and employs more than 11,000 people in 18 countries.
But it’s seeking to grow in the space of advising wealth managers, not simply one on one, but with software that helps monitor and make sure they do what’s best for their clients.
“Compensation management and compliance are key industry areas in need of transformation,” said Michael Alexander, head of North American Wealth and Capital Markets Solutions for Broadridge. “And we look forward to extending our industry leading capabilities.”
San Diego, Calif.-based Financial Database Services provides compensation and compliance software, including on boarding and analytics solutions.
Broadridge said its software can help companies comply with the Securities and Exchange Commission’s Best Interest rule, which reqiures weath advisors to recommend not simply in their interest, but in their client’s.
That, actually, is a big change, since advisors in the past could easily suggest investments that yielded the highest commisions for them – even if there were comparable products with lower charges to their clients.
The new regulation, however, requires broker-dealers to recommend only financial products in their customers’ best interest, and clearly identify any potential conflicts of interest and financial incentives the broker-dealer may have.
“We are excited to become part of industry leader Broadridge and to work together to continue to bring innovative solutions to a greater number of clients,” David Woltman, president of Financial Database Services, said.