Citigroup is apparently intent on bolstering its services to mutual funds, hedge funds and even private equity funds. It has agreed to acquire the Investment Services Division of Bisys for about $1.5 billion. Just like that, Citigroup becomes a leading provider of fund services and a top administrator for the private equity industry. The new services dovetail with the bank's existing services offerings and seems to be a bet on more outsourcing of administrative work by funds at all levels. Citigroup aims to be a full-service provider. As part of the deal, private equity firm JC Flowers will buy Bisys' insurance services and retirement services business from Citigroup. So we're seeing some tinkering on the part of Citigroup in response to the alternatives boom. We do not associate them yet with the top tier of prime brokers, but its thinking is clear.

For more:
- here's an brief from MarketWatch