BNP Paribas Securities Services has gone live with domestic sub-custody services in the Australian market, with custody and settlement services on offer since going live in May.
The bank says that local custody and settlement services are being used by external clients via BNP Paribas’ global custody network and that BNP Paribas Arbitrage, the group’s broker-dealer business unit, is also using the services. Australia becomes BNP Paribas’ 23rd market in which these services are offered.
“We previously had local custody capabilities in 22 different markets worldwide, and have now opened up domestic services in Australia alongside our global custody activities,” said Pierre Jond, managing director of BNP Paribas Securities Services Australia and New Zealand. “This means that we have the same global technology we can utilise in Australia.”
The decision to bring sub-custody services to Australia is a result of both BNP Paribas Securities Services’ global strategy of service provision as well as assessing the market opportunities afforded after the securities services business received its Australian banking licence last year.
“The business strategy was two-fold,”Jond said. “The first part was to open up a banking entity in July 2011. The idea was to provide banking services to our superannuation funds and asset manager clients. The concept behind the investment was really to offer treasury and other cash management services to clients, but along the way, as you build your business, you realise that the custody engine you have implemented in 22 other locations can be adopted here.”
Furthermore, the decision to open local custody and settlement services is attractive to global clients who would prefer to use BNP Paribas for Australian sub-custody, Jond adds.
“We are using the same technology,” he said. “It is low hanging fruit- the economics stack up for us. Global clients like to deal with BNP Paribas sub-custody branches locally. It is also the norm that as soon as we have an operational presence, we offer local custody services. That has been the cornerstone of our business.”
Reporting by Rachel Alembakis, Global Custodian Australia, an Asset International publication.