We help our clients to evaluate and select a broad spectrum of their third-party outsourced service providers:
Custodians
Depositaries
Administrators
Collateral managers
Derivative clearers
Digital asset custodians
Middle office providers
Securities lending agents
Orbit Diligence
Underpinning our process is Orbit Diligence, our proprietary automated due diligence, RFP and data exchange solution. It is a leading standalone, white-labelled site our clients use to manage their own processes.
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Custodian and other service provider RFPs and selection exercises
Our origins lie in global custody. Over the years, we have seen custody and other related asset servicing functions move out of the back office. The modern custodian is typically one of the largest counterparty relationships for most organisations and has the potential to add value across a client’s front, middle and back office.
Our robust RFP process is designed to meet both the ever-changing service offerings of custodians, and our clients’ buyer requirements.
As well as safekeeping assets and investments, custodians have become key sources of data and intelligence for clients. The role of the custodian has evolved to include data management, an added responsibility we take on in maintaining and curating accurate and actionable data on behalf of our clients.
Many of our custodian selection processes therefore now include an assessment of the ability of the custodian to perform this role as the consolidated information source for clients across asset classes.
A basic RFP process can be set out in four simple steps:
1. Issue, monitor and review RFP
2. Short-list/Star Chamber meetings
3. Due diligence
4. Project findings and conclusions
What are the options when it comes to custodian RFPs?
Do nothing
Leave it in the ‘too difficult’ box.
Benchmark and negotiate terms with incumbent
Significantly less work than an RFP process. Very few custodians will offer commercial, operational or contractual best market practice in the absence of competitive market tension.
Run an informal selection process
Difficult to establish and achieve true best market practice unless thorough analysis is undertaken across multiple candidates.
Go through a formal selection or re-selection process
Best market practice is to do this every five to seven years. It is the only way to ensure that the best possible arrangements have been achieved.
Insights
Central Bank of Ireland: UCITS Permitted Markets Regulation
The Central Bank of Ireland UCITS Permitted Markets Regulation relates to the eligibility criteria for markets into which UCITS funds can invest.
The essential role of fund administrators in investment funds
Fund administrators are specialised service providers that handle the administrative and operational aspects of investment funds.
Due diligence in private equity: Assessing risk to gain reward
In the competitive and high-stakes world of private equity, thorough due diligence is indispensable.
Outsourcing due diligence: Considerations for asset owners
Due diligence is one area in which organisations can immediately reap the benefits of outsourcing.