Assets under custody surged by 10.9 per cent to a new record of $4.4 trillion in the six months to 30 June 2021, according to the Australian Custodial Services Association (ACSA).
According to ACSA chief executive, Robert J Brown, the record result occurred on the back of valuation impacts and ongoing confidence in the key services provided by the securities services industry.
The statistics for the six months ending 30 June found that J.P. Morgan ranked the highest in the top ten total assets under custody for Australian investors.
As of 30 June 2021, J.P. Morgan had $1.07 trillion assets under custody, which marked an increase of 9.8 compared to 31 December 2020.
Northern Trust continues to take second place with $722 billion for six months ending 30 June compared with $661 for the six months ending 31 December 2020.
Citigroup takes third place with $673 billion, which represents an increase of 14.2 per cent compared to the six months ending 31 December 2020.
NAB Asset servicing came in fourth place again with $577, an increase of 7.1 per cent compared to $539 on 31 December 2020.
State Street took over from BNP Paribas in fifth place with $545 billion assets under custody, which represents an increase of 18.2 per cent compared to the six months ending 31 December 2020.
BNP Paribas, HSBC, Clearstream, Netwealth, and BNY Mellon followed the top five.
The statistics showed that asset servicing providers settled over 14 million trades during the six months to 30 June 2021. This equates to 110,000 settled trades per day on behalf of clients.
Brown comments: “Our members reported a bounce of 19 per cent for assets held offshore for Australian investors, compared to an increase of only 7 per cent for assets held onshore. While part of this differential is the result of currency valuation changes, it also reflects the long-term trend of institutional investors seeking returns beyond Australia.”
Brown explains that the new record of assets under custody, as well as significant trade and processing volumes, continue to be seamlessly supported by ACSA members on behalf of clients, and demonstrates continual efforts to improve efficiency across the service chain.
He continues: “Efficiency in custody and investment administration has been achieved through the innovation of ACSA member firms, tapping the right technology partnerships, and ongoing collaborative systemic focus on standards and common practice.”
“Over time, innovation will continue in support of client's growth, as well as changes to investment mix, including increased appetite for investment into direct assets such as private equity, debt and infrastructure,” Brown concludes.
