Over-capacity, fierce competition, tough economic conditions, changing market infrastructures and new regulations have led financial services companies to reconsider their core securities services activities.
As a result, many of the financial services providers are progressively transforming their securities services operating models towards more rationalized and specialized models.
Global custodians have built very specialized platforms combining centralized hubs with satellite local service centers. The most basic and standardized processes are executed off shore in low cost centers.
Medium-sized and large private banks have implemented regional hubs or trans-regional hubs and global platforms. The trend towards this model will continue and be further re-inforced.
For smaller private banks, the trend is less clear. They do not necessarily have the capital to invest in new and/or more rationalized platforms and have a hesitant strategy towards outsourcing because of the fl exibility that their private clients demand.
Retail and universal banks are the most diverse group of actors, with models ranging from local fragmented models to group centralized ones. A clear trend cannot be distinguished, however, for players that are part of a group, an evolution towards more centralization is to be expected. For smaller or independent players, a trend towards outsourcing is emerging.
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