A study on custodian services
Definition A financial institution that holds customers ' securities for safekeeping so as to minimize the risk of their theft or loss. A custodian holds securities and other assets in electronic or physical form. Since they are responsible for the safety of assets and securities that may be worth hundreds of millions or even billions of dollars, custodians generally tend to be large and reputable firms.
A custodian bank, or simply custodian, is a specialized financial institution responsible for safeguarding a firm 's or individual 's financial assets and is not necessarily engaged in "traditional" commercial or consumer/retail banking such as mortgage or personal lending, branch banking, personal accounts, ATMs and so forth. The role of a custodian in such a case would be to:
hold in safekeeping assets/securities such as stocks, bonds, commodities such as precious metals and currency (cash), domestic and foreign arrange settlement of any purchases and sales and deliveries in/out of such securities and currency collect information on and income from such assets (dividends in the case of stocks/equities and coupons (interest payments) in the case of bonds) and administer related tax withholding documents and foreign tax reclamation administer voluntary and involuntary corporate actions on securities held such as stock dividends, splits, business combinations (mergers), tender offers, bond calls, etc. provide information on the securities and their issuers such as annual general meetings and related proxies maintain currency/cash bank accounts, effect deposits and withdrawals and manage other cash transactions perform foreign exchange transactions often perform additional services for particular clients such as mutual funds; examples include fund accounting, administration, legal, compliance and tax support services
Custodian banks are often referred to as global custodians if they
A custodian bank, or simply custodian, is a specialized financial institution responsible for safeguarding a firm 's or individual 's financial assets and is not necessarily engaged in "traditional" commercial or consumer/retail banking such as mortgage or personal lending, branch banking, personal accounts, ATMs and so forth. The role of a custodian in such a case would be to:
hold in safekeeping assets/securities such as stocks, bonds, commodities such as precious metals and currency (cash), domestic and foreign arrange settlement of any purchases and sales and deliveries in/out of such securities and currency collect information on and income from such assets (dividends in the case of stocks/equities and coupons (interest payments) in the case of bonds) and administer related tax withholding documents and foreign tax reclamation administer voluntary and involuntary corporate actions on securities held such as stock dividends, splits, business combinations (mergers), tender offers, bond calls, etc. provide information on the securities and their issuers such as annual general meetings and related proxies maintain currency/cash bank accounts, effect deposits and withdrawals and manage other cash transactions perform foreign exchange transactions often perform additional services for particular clients such as mutual funds; examples include fund accounting, administration, legal, compliance and tax support services
Custodian banks are often referred to as global custodians if they
References: BOOKS Shrieves, R. E. “The relationship between risk and capital in commercial banks”. Journal of Banking & Finance, 16(2): 439–457, 1992. Zhao, T., Casu, B. and Ferrari, A. “Deregulation and Productivity Growth: A Study of The Indian Commercial Banking Industry”. International Journal of Business Performance. WEBLIOGRAPHY www.occ/gov www.wiki.com