NUNAVUT
The trust in charge of $1.6 billion in assets from the Nunavut Land Claims Agreement is now working with a specialized financial institution.

Arti Sharma, head of Northern Trust Canada, said she is delighted her company was selected to be the specialized financial institution, or "global custodian," for the $1.6B Nunavut Trust. - photo courtesy of Northern Trust

Northern Trust (NASDAQ: NTRS) has been selected by the Nunavut Trust as its new "global custodian" for cash management, securities lending, risk analytics, foreign exchange, class action processing and other services

Nunavut Trust CEO Fern Elliot said the switch from the Royal Bank of Canada was the result of an initiative to be more efficient and minimize the impact of operating costs on the trust.

A public request for proposal revealed a highly competitive market.

"All of the competitors were cheaper," Elliot told News/North on the phone from her office in Ottawa. "From our perspective, it was a substantial reduction in cost."

Elliot also said the Nunavut Trust had grown and become much more complex since they first started working with RBC in 1998. She called the package that was being offered by Northern "technologically more suitable to what they were looking for," had the capability of tailoring a lot of the reporting to their specific needs and would allow a lot of private investments to be brought in as a pool into the company's system.

"They were able to customize that platform to satisfy a lot of the things ... we needed to see," Elliot said, "Basically outsource some of that administration and human output time inside our office and get it all in one package."

She described the switch as an administration duty that did not affect the individual Nunavut Inuk person on the street beyond the trust managing their costs and following good governance procedures. "We're improving the efficiency of our operation," Elliot said, "so that we have time to look at the information instead of spending all of our time creating the information."

Elliot also dismissed any concerns or criticisms regarding Northern Trust's status as an American company compared to RBC. "It's not a new entity that's venturing into the Canadian market," she said. "They've been there for quite a long time."

Arti Sharma, head of Northern Trust Canada, said the company currently has approximately $7 billion in assets under management but the Nunavut Trust was "absolutely" a significant addition to the company's list of clients. "We have been focused on this opportunity for a long period of time and delighted to be appointed by Nunavut," she stated in an e-mailed.

While the company does not offer retail banking services in Canada, Sharma said her company was looking to increase market share in the country. "Being appointed by Nunavut is a testament to our business strategy," she said, calling the Nunavut Trust part of Northern Trust's Canadian heritage. "We are extremely proud to be selected to service their assets."