The year 2000 served as a catchall for the “future” for quite some time. The Y2K problem-that-was-not is only one of the failed predictions that filled the newspapers until the turn of the century. In 1900, one of the Seven Sisters of women’s magazines, Ladies’ Home Journal, published its forecasts, which were of the more mundane variety (gems included “no mosquitoes or flies” and “there will be no C, X or Q in our everyday alphabet”).
It is a reminder that exercises like these combine absurdity with arrogance, because nobody knows what the future holds. So it is with a strong sense of arrogant absurdity that Global Custodian projects the future of securities services a mere two years out. In 2015, what will global custodians look like? Will they be bigger or smaller? Specialists or part of universal banks? What services will they provide? And, with the burden of rising capital and liquidity ratios and the cost of compliance rising steadily, has the industry gone ex-growth? If the industry shrank, say, 20%, how many global custodians would survive? And what does this mean for clients?