• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to secondary sidebar
  • Skip to footer
  • Subscribe
  • Twitter
  • RSS Feed

Investment News NZ

Investment News provides financial advisers news stories from the financial industry in New Zealand. Subscribe to our free weekly newsletter.

  • Home
  • News
  • Kiwisaver
  • Subscribe
  • About
  • Advertise
  • Contact
You are here: Home / Investment News / J.P. Morgan cleans out the cupboard for sub-custody

J.P. Morgan cleans out the cupboard for sub-custody

March 22, 2020

J.P. Morgan, Australia’s largest securities services firm, has told several of its direct sub-custody clients that they need to look elsewhere for another provider. The biggest of these, Clearstream, is already going to tender. This doesn’t happen too often, but it happens, and reflects the intricate nature of the asset servicing business.

J.P. Morgan Securities Services has told its Australian and New Zealand- based sub-custody-only clients that they should look for another provider. J.P. Morgan is the custodian for Australia’s largest super fund, AustralianSuper, as well as NZ’s largest fiduciary fund, the ACC (the Accident Compensation Corporation).

A J.P. Morgan spokesperson said she was unable to reveal how many clients were affected by the decision. “It’s not many, though” she said. The word around the traps is that they are mainly former clients of ANZ Bank’s securities services business, purchased by J.P. Morgan in 2010.

Securities servicing is a low-margin business. Custodians look to get extra revenue from added services, such as master custody, global custody, securities lending and cash and FX management. ‘Sub-custody’, sometimes known as ‘domestic custody’ is the lowest margin part of the range of services they offer.

Clearstream is going to tender for its sub-custody business covering between A$50-60 billion. Clearstream, which is owned by Deutsche Borse, bought Ausmaq, a post-trade services provider, from National Australia Bank mid-way through last year. The PR spokesperson for Clearstream, in Frankfurt, said: “We are evaluating the situation to find the best solution together with our customers. Please understand that we won’t comment further on the situation.” Thanks for that.

J.P. Morgan has not sold the business or nominated a preferred alternative provider. The bank says it remains committed to supporting global custody clients and affiliates in Australia and New Zealand and will continue to act as the sub-custodian entity in the Australian market, and its New Zealand Branch will continue to act as the sub-custodian entity in New Zealand.

It is leaving it up to the clients to make their own decisions about an alternative provider and has offered to work with the clients to ensure a smooth transition. Global custody will become the primary driver for J.P.’s security services clients in Australia and NZ.

 

 

Greg Bright is publisher of Investor Strategy News (Australia)

Print Friendly, PDF & Email
Twitter0
LinkedIn0
Google+0
Facebook0

Read More » Investment News

Recent articles

  • New Salt suite to spice up fund mix January 17, 2021
  • Wealth head quits ASB for Tower job; Platinum loses Asia manager; Matterson moves from Milliman January 17, 2021
  • Westpac follows ANZ with Northern Trust mandate… January 17, 2021
  • … as Trust Management wins over another senior BT investment hand January 17, 2021
  • Capital ventures into BlackRock’s ETF territory January 17, 2021
  • Fresh CIO role as South Pacific aims for co-investments January 17, 2021
  • Lessons from 2020: don’t stop thinking about tomorrow January 17, 2021
  • SSGA to push big firms on ESG, stays mum on merger January 17, 2021
  • Low-carbon switch: why electric future turns on listed infrastructure investor January 17, 2021

Primary Sidebar

WEEKLY NEWSLETTER

Sign up here to receive our weekly newsletter.
Learn More »

Most Recent Investment News

New Salt suite to spice up fund mix

January 17, 2021

Wealth head quits ASB for Tower job; Platinum loses Asia manager; Matterson moves from Milliman

January 17, 2021

Westpac follows ANZ with Northern Trust mandate…

January 17, 2021

… as Trust Management wins over another senior BT investment hand

January 17, 2021

Capital ventures into BlackRock’s ETF territory

January 17, 2021

Search by Keyword

Investment News

  • New Salt suite to spice up fund mix January 17, 2021
  • Wealth head quits ASB for Tower job; Platinum loses Asia manager; Matterson moves from Milliman January 17, 2021
  • Westpac follows ANZ with Northern Trust mandate… January 17, 2021
  • … as Trust Management wins over another senior BT investment hand January 17, 2021
  • Capital ventures into BlackRock’s ETF territory January 17, 2021
  • Fresh CIO role as South Pacific aims for co-investments January 17, 2021
  • Lessons from 2020: don’t stop thinking about tomorrow January 17, 2021
  • SSGA to push big firms on ESG, stays mum on merger January 17, 2021
  • Low-carbon switch: why electric future turns on listed infrastructure investor January 17, 2021
  • Bitcoin: the nonsensical asset that makes sense for the times January 17, 2021

Investment News Archive

Most Popular Articles

  • Westpac NZ flags retail advice sale to Forsyth Barr posted on October 19, 2020
  • NZ share-trading splurge could trigger tax alarms… posted on October 5, 2020
  • The horror year in technicolour: free KiwiSaver 13 report released posted on September 30, 2020
  • Flint set to spark platform competition posted on August 17, 2020
  • Four to the core: Smartshares to expand, rearrange and reprice ETFs posted on June 22, 2020
  • Kitset KiwiSaver scheme set to unwrap in spring posted on April 27, 2020
  • Funds eye bargains, self-shoppers hoard cash, KiwiSavers turn conservative posted on March 15, 2020
  • AMP Capital NZ chief quits amid equities exodus offshore posted on August 28, 2020

Sponosored Content

David-Boyle

On the industry play-list: four chart-topping regulations for 2021

David-Boyle

Charge of the lite (advice) brigade

Nathan Field

Pandemic Baby Boom a Bust

Star-date 2020: it’s inflation Jim but not as we know it

Quick-links to Popular News

  • FAP Compliance
  • Coronavirus
  • New Appointments
  • Financial Markets Authority (FMA)
  • Kiwisaver
  • Climate Change
  • Crypto Currency
  • Blockchain
  • Insurance

Secondary Sidebar

Recent News

  • New Salt suite to spice up fund mix January 17, 2021
  • Wealth head quits ASB for Tower job; Platinum loses Asia manager; Matterson moves from Milliman January 17, 2021
  • Westpac follows ANZ with Northern Trust mandate… January 17, 2021
  • … as Trust Management wins over another senior BT investment hand January 17, 2021
  • Capital ventures into BlackRock’s ETF territory January 17, 2021
  • Fresh CIO role as South Pacific aims for co-investments January 17, 2021
  • Lessons from 2020: don’t stop thinking about tomorrow January 17, 2021
  • SSGA to push big firms on ESG, stays mum on merger January 17, 2021
  • Low-carbon switch: why electric future turns on listed infrastructure investor January 17, 2021
  • Bitcoin: the nonsensical asset that makes sense for the times January 17, 2021

Footer

Copyright ©2020 InvestmentNews.co.nz — All Rights Reserved ·— Terms & Conditions