TBRC: Global custody services market to see decline amid COVID-19
07 July 2020 London
Image: Eightshot_Studio/Shutterstock
The global custody services market is expected to decline by 2.8 percent to $64.27 billion as a result of the ongoing COVID-19 pandemic and the measures to contain it, according to a new global report by The Business Research Company (TBRC).
The new report identifies that growth in the custody services market is currently impaired by increasing competition from numerous banks that provide custody services on a global, regional, and local scale. Price competition in particular pressurises banks in the global market.
Traditional securities services providers such as multinational custodians and fund management specialists are currently facing increasing competition from central securities depositories, central counterparty clearing houses, and outsourced service providers.
However, TBRC also highlighted that the global custody services market is predicted to experience a recovery, reaching $80.96 billion in 2023 at a compound annual growth rate of 8 percent.
Future growth in the custody services market is expected to be motivated by automation and standardisation of core custody services and operations to facilitate higher visibility, improved productivity, cost reductions, and an overall improvement in quality of service.
In addition, TBRC said it expects automation and standardisation to cause the current asset-centric model to transform into a more data-centric, open platform environment, such as automated reporting systems that provide daily exceptions reports, available securities for and on loan, valuation of cash collateral, and margin calls.
The global custody services market is segmented by service into core custody services, ancillary services, core depository services, and other administrative services.
The new report identifies that growth in the custody services market is currently impaired by increasing competition from numerous banks that provide custody services on a global, regional, and local scale. Price competition in particular pressurises banks in the global market.
Traditional securities services providers such as multinational custodians and fund management specialists are currently facing increasing competition from central securities depositories, central counterparty clearing houses, and outsourced service providers.
However, TBRC also highlighted that the global custody services market is predicted to experience a recovery, reaching $80.96 billion in 2023 at a compound annual growth rate of 8 percent.
Future growth in the custody services market is expected to be motivated by automation and standardisation of core custody services and operations to facilitate higher visibility, improved productivity, cost reductions, and an overall improvement in quality of service.
In addition, TBRC said it expects automation and standardisation to cause the current asset-centric model to transform into a more data-centric, open platform environment, such as automated reporting systems that provide daily exceptions reports, available securities for and on loan, valuation of cash collateral, and margin calls.
The global custody services market is segmented by service into core custody services, ancillary services, core depository services, and other administrative services.
NO FEE, NO RISK
100% ON RETURNS If you invest in only one asset servicing news source this year, make sure it is your free subscription to Asset Servicing Times
100% ON RETURNS If you invest in only one asset servicing news source this year, make sure it is your free subscription to Asset Servicing Times
.jpg)