Pandemic takes its toll on custody scores

A global survey of over 800 custody clients shows that over the past year appreciation levels of the job sub-custodians are doing have dropped. That said, in the vast bulk of markets, service expectations appear to have been met, though what people are paying for them is a different story.

The accompanying table shows global average scores for various categories of service. After a few years of improving results, these are now back to their traditional position, where 5.00 to 5.99 represents ‘Good’, but not ‘Exciting’. Pricing is on the cusp between Good and Satisfactory. 

The Global Custodian Agent Bank Surveys – major, emerging and frontier – are designed to elicit the views and perceptions of cross-border investors about the post-trade services they receive in markets around the world. They have been conducted annually since 1989.  

The Agent Banks in Major Markets (ABMM) Survey focuses primarily on those markets categorised as developed by MSCI and S&P. Network managers and operations executives from leading global custodians, correspondent banks, brokers, infrastructure providers and asset managers are invited to evaluate the performance of their agent banks. 

The questionnaire was revamped for 2021. Completed online, it included 13 service categories. A scorecard allowed respondents to rate each category on a seven-point scale from Unacceptable to Excellent. Responses were converted by the survey system into numbers with 1 being Unacceptable and 7 being Excellent. 

The survey once again confirmed a trend to more regional relationships and a growing dominance of regional providers in most major markets. Leading the way in that regard is the Nordic region, the individual markets of which have been grouped under a regional umbrella. 

The full survey report is in the latest edition of Global Custodian released last week and is available to subscribers. For more information contact [email protected]

About Wanda Dufresne

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