Anglo to stop providing custodianship services
ANGLO Irish Bank, which has been nationalised for almost two years, is leaving the custodian banking market, a small part of financial services which can be lucrative for larger players.
Anglo has informed several clients it no longer intends to provide custodianship services -- effectively minding investor's money and assets -- and is exiting from the market.
A bank acts as a custodian for clients by safekeeping assets and securities and collecting dividends on various investments on behalf of these clients.
It effectively removes a lot of the back-office work for the client and providers collect a fee for services.
Irish banks all offer custodian services, but it was never a very large provider of revenues for Anglo.
The bank, nationalised in January 2009, has provided custodian services to property investors, private equity funds and also for some private clients, who took out personal investments through Anglo Irish Private Banking.
Anglo has been informing clients of the change over the past three months, and another firm has taken over some of the activity on an outsourced basis to allow clients to source a more permanent custodian. The largest operators in the custodian market have to be global in nature, although Ireland does play host to several of them via locations in the IFSC.
For example, State Street is a major custodian bank. One of the biggest custodians is Bank of New York Mellon, which also has operations here.
Anglo is going into a wind-down situation and may have some of its operations merged with Irish Nationwide. However, its chief executive Michael Aynsley recently sought to reassure clients it was not shutting down, despite a dreadful record of asset writedowns.