Fidelity Signs Broker-Dealer Clearing Deal With JPMorgan’s BDS

JPMorgan Chase & Co. is exiting its third-party broker-dealer clearing business, striking a deal with National Financial under which the Fidelity firm will become the preferred clearing provider for the third-party BDs that currently clear through JPM’s Broker Dealer Services (BDS) business. 

Fidelity would not release financial details of the agreement, but Sanjiv Mirchandani, president of National Financial, said he would not characterize the agreement as a “classic acquisition or merger.” Instead, he said Fidelity would work with the third-party BDs to ensure a “smooth client transition” to National Financial’s platform, “without a new clearing agreement.”

Joe Triarsi, global head of BDS, will assist in that transition, following which he and several other members of the BDS management team, Mirchandani said, will become employees of National Financial.

Mirchandani said the deal will “add scale and great people” to National Financial while “allowing JPMorgan to achieve their objectives.” Moreover, the transfer of Triarsi and other BDS management will help the more than 100 BDs that currently clear through BDS “to have the maximum amount of confidence” in National Financial’s service platform, providing a “continuity of people and knowledge and service levels.”