Training Courses

Global Custody Workshop

Category: Client Services

Course level: Introductory to Intermediate

In house

This one-day workshop is designed for staff who need a fast-track understanding of global custody.

It will cover the regulatory requirements for financial services companies to provide safe custody of their customers’ assets, as well as issues surrounding the client-custodian relationship.

No prior knowledge is assumed and all terms will be fully explained. Case studies form an integral part of the course, to enable delegates to consolidate the information and provide the basis for group discussions.

Objectives

By the end of the course, delegates will be able to understand and explain the following concepts:

  • principles and processes involved in custody
  • global custody
  • the role of the custodian and nominees
  • risks associated with custody
  • the regulatory environment

Length

1 day

Course Content

Introduction

What is custody?
Safekeeping clients’ assets, administration
Internal vs external custody arrangements

Financial services regulation

Financial Services & Markets Act 2000
Role of the FSA
Regulation of custody: how to demonstrate full compliance

Understanding the asset classes

Shares (equity and preference shares)
Fixed income (government bonds, corporate bonds, eurobonds, equity-linked bonds)
Cash and currencies
Derivatives
Collective investment funds
Registered vs bearer securities
Physical vs electronic delivery

Anatomy of a typical custodian network

Independent vs integrated groups
Central Securities Depositories (CSDs)
International Central Securities Depositories (ICSDs)
Local and regional custodian
    CREST, DTC, EU systems
The technology issues
    ETC, STP, DTC systems, SWIFT payment systems

Global custodians

Choosing a global custodian
Sub-custodians (what role do they play, what are their responsibilities?)
Costs
Writing a custody agreement
 

Plain vanilla custody services

Settlement
Safekeeping
    Reporting and reconciliation requirements
    FSA regulations
Income distribution
Proxy voting
Cash management
Tax reclaims
Corporate actions

Value-added custody services

Stock lending and repos
Investment accounting
Performance measurement
Settling derivatives trades (clearing members)

Risk management

Identifying risk – business risk, country risk, counterparty risk, etc.
Managing risk – ISSA recommendations

What does the future hold?

Review of recent developments in global custody

This course would be suitable for:

  • Investment administration and operations
  • Investment professionals
  • IT and software developers
  • Legal & Compliance
  • New entrants

This course would be suitable for these exams:

  • SII IAQ - Global Securities Operations
  • SII IAQ - IT in Investment Operations
  • UKSIP - Investment Operations
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