One of America's biggest banks ? JP Morgan Chase & Co. ? is putting down roots in Bermuda with its announcement yesterday that it was buying up a fund administrator operating on the Island.

The deal, for an undisclosed amount, will see JPMorgan Chase ? which is reputed to be second largest US banking firm ? acquire Tranaut Fund Administration Ltd., a privately-owned hedge fund administration services company said to service about 40 hedge funds.

Tranaut, which has offices in Dublin and Bermuda, helps hedge fund managers with accounting services as well as taking on the task of corresponding with fund investors.

Of Tranaut's 45 employees, nine are based in Bermuda, the company said yesterday.

JPMorgan's planned acquisition, which was for an undisclosed amount, follows a wave of other financial services institutions snapping up fund administration firms on the Island in recent years.

Tranaut, which is run out of offices in Argonaut House on Park Road, was set up in 1999 and has grown to have $5 billion in assets under administration.

Yesterday, a company spokesman told from that it was early days, with the sale not due to close until some time in the third quarter, but growth was the expected result of the deal and said no job cuts were expected at this time.

Meanwhile, in a Press statement issued yesterday afternoon, JPMorgan said the acquisition was a strategic addition to its "comprehensive suite of services that is already offered to hedge funds and institutional investors.

Conrad Kozak, JPMorgan's head of strategic business development, treasury and securities services, said: "This acquisition represents a logical extension to the firm's servicing capabilities and demonstrates our commitment to servicing a wide range of investment products on a global basis.

"We are pleased to welcome an organisation that is recognised as best-in-class in their industry into our firm, and we are excited about the growth opportunity that this acquisition provides."

JPMorgan's deal signals a continuation of a trend with Tranaut being yet another hedge fund administrator to go up on the sales block in recent years.

Those close to the industry yesterday conceded that consolidation has been the trend in the sector, something that has been apparent in Bermuda with BISYS buying up fund administrator Hemisphere Management from Mutual Risk Management in 2002. Then in February, 2003, Bank of New York bought International Fund Administrators Ltd. (IFA). That was followed in November of last year by the sale of Forum Financial Group, which is also a Bermuda-based fund administrator, to Citigroup.

Earlier this year the trend continued with the $1.3 billion dollar sale of the Bank of Bermuda to multinational banking giant HSBC Plc., which saw the bank as a good buy largely because of opportunities in this area.

Yesterday, Tranaut director Stuart Drake said: "We are delighted to be working with JPMorgan and we are confident in the firm's commitment to the hedge fund market and its clients,"

Assets in hedge funds, which are investment pools that tend to be less stringently regulated than some other investments because they cater to sophisticated and institutional high-net worth clients, have seen significant growth in recent years.

"The hedge-fund sector is one of the fastest-growing, and we needed to play in that game," Mr. Kozak, told Bloomberg yesterday.