The Australian Custodial Services Association (ACSA) has revealed the value of assets under custody for both Australian and foreign investors rebounded over the final six months of 2020 on the back of the global market performance.
The asset servicing industry statistics for the six-months ending 31 December 2020 showed that J.P. Morgan ranked the highest in the top ten total assets under custody for Australian investors.
As at 31 December 2020, J.P. Morgan had (AUD) $973 billion, which marked an 18.7 per cent increase compared to 30 June 2020.
Northern Trust continues to take second place with $661 billion for the six months ending 31 December compared with $562 for the six months ending June 2020. This represented an increase of 17.7 per cent.
Citigroup takes third place with $590 billion, which represented an 8 per cent increase compared to the six months ending 30 June 2020.
After Citigroup came NAB Asset Servicing with $539 billion total assets under custody for Australian investors. NAB Asset Servicing experienced a 1.5 per cent increase compared with the six months ending 30 June 2020.
BNP Paribas came in fifth place with $475 billion for the six months ending 31 December marking an increase of 2.5 per cent compared to the six months ending 30 June 2020.
State Street, HSBC, Clearstream, Netwealth and BNY Mellon followed the top five.
The total assets under custody for Australian investors jumped by 7 per cent over the last six months of 2020 to $4 trillion.
Netwealth experienced the biggest increase (23 per cent) with $38.8 billion for the six months ending December 2020 compared to $31.5 billion for the six months ending 30 June 2020.
BNY Mellon was the only one to experience a decrease (-4 per cent) as its figures came in at $25.9 billion for the six months ending 31 December.
ACSA chief executive, Robert J Brown, says: “The rebound in assets under custody is a result of the bounce in market valuations that occurred over the second half of 2020 on the back of improving market returns and ongoing client confidence in ACSA member’s custody and investment administration solutions.”
Brown explains: “Looking behind the numbers, there has been continued operational adaption to pandemic impacts that have allowed the industry to remain resilient. As with the early lessons learned from the national lockdown, exception processing remains the weak link with some transaction types dependent on wet ink signatures and physical documents – these transactions require new approaches to improve efficiency, contain risk and minimise the potential for disruption.”
“Overall the industry is highly automated, but a small proportion of asset types present challenges in normal times which are amplified through pandemic interruption. ACSA remains engaged with all parties in the service chain to improve efficiency,” Brown concludes.
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