BNP Paribas Securities Services (BNP Paribas) today announced that it will launch a local custody service in the United States of America, enabling it to provide post-trade services to multi-national banks, brokers and institutional investors in the world's largest capital market.
BNP Paribas, a global custodian with almost USD 7 trillion in assets under custody, will offer local clearing, settlement and custody of all major asset classes listed on NYSE Euronext and NASDAQ OMX, and will connect directly to the US Depository Trust and Clearing Corporation.
Expanding its local custody network is at the core of the bank's strategy to support its clients' investment activities in the world's largest financial centres. The addition of the US reduces its reliance on external sub-custodians and significantly increases the amount of client assets held entirely within BNP Paribas. This has additional benefits in the current regulatory environment where increasing emphasis is put on end-to-end operational control.
"Extending our sub-custody capabilities to include the US means that we will become the local custodian for more than 90 per cent of our clients' global assets," said Patrick Colle, chief executive of BNP Paribas Securities Services. "Asset safety has never been as important to investors as it is today, and with our strength of balance sheet and now local capabilities in the US, we feel that we will offer investors a unique proposition."
It will also be a significant development in the custodian's investment programme in the US. Last February, Claudine Gallagher was appointed regional manager of North America to spearhead the growth of the business there, including the anticipated launch of global custody in 2013.
"North America is a crucial market to investors whether on the buy or sell side, in Europe or Asia," said Ms Gallagher, who also sits on the custodian's executive committee. "Processing our first transactions as a local custodian in the US will be an important milestone in our commitment towards supporting US investors and an increasingly global client base."
Mr Colle added that the development will form a crucial part of the custodian bank's strategy to become a truly global player with a global offering.
The BNP Paribas Group, which also includes retail banking, investment banking and investment solutions, has operated in North America for almost 140 years. Its securities services business has been there for more than 25 years. It offers derivatives and correspondent clearing, and operates as a conduit for US banks and brokers to access post-trade infrastructure in Europe. Last February, the custodian won the Wall Street Letter award for the Best Broker-Dealer Clearing Service in the US.