FRENCH bank BNP Paribas will today reverse the trend of European banks cutting back as US banks expand, by launching a local custody service in the US.
The bank has taken on 60 staff this year to launch the unit, which can now provide post-trade services to multi-national banks, brokers and institutional investors.
Instead of sub-contracting investors’ funds out to local providers in the US, as it has been forced to do in the past, the new service means BNP Paribas can now provide the service itself.
As a result, UK institutions using BNP Paribas for global custody now have an average of more than 90 per cent of their assets within the bank.
“North America is a crucial market to investors whether on the buy or sell side, in Europe or Asia,” said regional head Claudine Gallagher.
“Processing our first transactions as a local custodian in the US will be an important milestone in our commitment towards supporting US investors and an increasingly global client base.”
The new set up also means the bank can more easily win business from US mutual funds – on Friday BNP Paribas announced it had gained the mandate of Edgewood L Select, the Luxembourg-domiciled unit of a US fund.