Global Custodian Bank Ratings

What is a rating of a global custodian bank?

It is an independent assessment by Thomas Murray of the service capabilities of a global custodian bank which concludes with the establishment of an overall rating on the familiar AAA to C ratings scale. A rating review, in which Thomas Murray analysts visit the operations of the bank, covers absolute and relative service quality in settlement, safekeeping, income collection, corporate actions processing, proxy voting, tax reclaims, cash management, foreign exchange and securities lending. The review also assesses the commitment of the bank to the business, and its capabilities in reporting and technology, network management, relationship management and the management of financial, custody, asset servicing and operational risks. Ratings are commissioned by banks to benchmark themselves against best market practices. Most banks choose to keep their rating confidential, but some publish it as a guarantee of service quality to existing and prospective clients.

What is a rating of a domestic custodian bank?

It is an independent assessment by Thomas Murray of the service capabilities of a custodian bank which offers a service in a single market or group of markets. Most domestic market custodians act as sub-custodians to global custodian banks, but may also have a number of purely domestic clients for which they act in the domestic market only. The rating assesses the domestic market custody services offered to in-bound, regional and local customers. Like the global custodian bank rating process, the assessment concludes with the establishment of an overall rating on the familiar AAA to C ratings scale, which the rated bank is free to publish or keep confidential.

What is a private rating of a custodian bank?

It is an assessment of a global, domestic or sub-custodian bank commissioned from Thomas Murray by a buyer of custody services – typically a global custodian bank, or an institutional investor – with the agreement and co-operation of the bank being rated. Though the rating process is similar to the ratings commissioned by custodian banks themselves, it is adapted to the particular service needs of the client. These are derived either from the contractual and service level agreements already in place between the bank and the client or, where a relationship is not yet in place, from a specially prepared questionnaire. This means the final outcome is never published, and remains private between the custodian, the client and Thomas Murray. A rating decision is also discussed, prior to finalisation, with both the custodian and the client.