Cutwater Asset Management to be absorbed by BNY Mellon

The more than 20 year old asset manager will be administered by BNY Mellon’s Europe-based Insight Investment.

BNY Mellon is set to acquire Cutwater Asset Management, the US-based fixed income investor with around $23 billion under management, according to a statement by the US bank. Cutwater is currently a wholly-owned subsidiary of bond investor MBIA.

Cutwater will become part of BNY Mellon Investment Management and will be administered by Europe-based Insight Investment, also owned by BNY Mellon. The merger will enhance the bank’s US platform.

Cutwater offers a wide range of fixed income strategies including core, long duration, high yield and absolute return. The asset manager launched its bank loan and CLO strategies in 2013.

The deal is expected to close in early 2015.

“Given the unprecedented interest in the fixed income market at this time, we are excited by the opportunity to expand our investment offerings for clients as a result of this combination of fixed income capabilities,” said BNY Mellon Investment Management’s chief executive, Curtis Arledge.

BNY Mellon Investment Management has $1.6 trillion in assets under management.

Cutwater closed a $415 million collateralised loan obligation in July. The notes are backed primarily by US dollar-denominated first lien senior secured broadly syndicated loans.