Citibank Global Securities Services announced today that it had cleared the $5 trillion hurdle for assets under custody. The question is: who cares? This still leaves the bank exactly where it was: in fourth place behind Bank of New York, JP Morgan and State Street. And global custody is not, contrary to journalistic impressions, purely or even mainly, about of economies of scale.
But Citibank still believes its self-congratulation is warranted by the feat of growing assets by 16 per cent in the last year, which has coincided with the worst bear market for a decade. Citibank says its growth rate has significantly outpaced that of any of the major global custodians. “Despite subdued market conditions, Citibank has experienced impressive asset growth around the world, which highlights our strong momentum serving the needs of the world’s largest asset managers, pension funds, insurance companies and other cross-border institutional investors,” says Simon Collier, head of Global Securities Services for Investors.
How did Citibank do it? By retaining existing customers, and making new sales, says the bank. Collier attributes the success mainly to the global network, but also praises his technology, service and system platforms. “We have the industry’s most comprehensive data warehouse, service centres in every region of the world, and a web-enabled technology infrastructure that allows us to deliver value-added products and services that meet investors’ evolving needs,” he says.