Each company is in talks to buy Barclays Plc’s fund unit, whose $1.5 trillion in client assets ranks highest in the industry, people familiar with the matter said last week. Each covets Barclays Global Investors’ exchanged-traded funds, quantitative index investments and securities-lending business, analysts said.
“This will change the landscape, whether Bank of New York or BlackRock gets it,” said Geoff Bobroff, president of Bobroff Consulting Inc., an East Greenwich, Rhode Island, firm that advises mutual-fund companies.
BGI, based in San Francisco, would vault BlackRock, the largest publicly traded money manager in the U.S., to $2.81 trillion in assets. BNY Mellon, the world’s biggest custody bank, would rise to $2.38 trillion, surpassing firms including Fidelity Investments and Vanguard Group Inc. The New York-based companies would gain more customers outside of the U.S. and put pressure on their main rivals — Pacific Investment Management Co. for BlackRock, and State Street Corp. for BNY Mellon — to catch up.