Master Custody Australia

As the Australian master custody industry continues to grow and expand in size of assets under custody, diversity of investment markets and instruments and subsequent service requirements, funds are faced with the question of how best to evaluate whether their master custodian remains competitive and best suited to meet the needs of their managed or superannuation fund.

If the relationship with the master custodian needs benchmarking or the trustees have suggested a due diligence review of how the service provider compares with others available in the Australian custody market then it may be prudent to assess and benchmark the custody provider in any or all of the following areas:

• Asset safekeeping and servicing
• Fund accounting
• Compliance monitoring
• Performance measurement
• Tax services
• Regulatory reporting
• Registration services

A report containing custody fee analysis and operational benchmarking in these areas can be helpful in regulatory reviews and for audit and compliance committee meetings and ongoing Custodian Monitoring can assist in meeting the requirements of these groups. A detailed assessment and evaluation of current custodian relationship may trigger the need for a full review and the issue of a competitive Request for Proposal (‘RFP’) to global custodian banks.

As custodian services become more sophisticated globally it is important to keep informed about global best market practice and make sure your fund executive is driving the delivery of innovation and efficiency with the custodian in Australia.

Thomas Murray’s Custodian Assessment and Monitoring services enable Australian funds to benchmark the master custody service provider against global best market practice and identify areas for negotiation and improvement.