JP Morgan is closing in on NAB Asset Servicing as the largest player in the Australian custody market, increasing its assets under custody by 16.5 per cent in the six months to 30 June 2015.
According to data from the Australian Custodial Services Association (ACSA), although NAB Asset Servicing remains the largest custodial provider, its total assets under custody increased only slightly by 1.4 per cent in the six months to 30 June 2015.
In contrast, JP Morgan came in as the second largest overall custodian, increasing its assets under custody by 16.5 per cent.
Citgroup and Northern Trust also noted considerable increases of 17.5 per cent and 20.7 per cent respectively.
ACSA pointed out that the top five custodians – NAB Asset Servicing, JP Morgan, BNP Paribas, Citigroup and Northern Trust – manage 78 per cent of total assets under custody.
ACSA chair David Knights said: “There are now close to $2.8 trillion worth of assets under custody in Australia, compared to $1.6 trillion on the ASX, which means ACSA’s members are looking after assets worth around 176 per cent more than the market value of the ASX.
“This growth in unlisted and alternative assets creates new challenges in terms of how we classify and hold assets such as syndicated loans, and we continue to work closely with our stakeholders to ensure we safeguard these assets effectively.”
JP Morgan remains the largest custodian of non-Australian assets for Australian investors, holding $290.19 billion in assets with an increase of 19 per cent on the previous year. Citigroup also noted an increase, up 21 per cent to $127.12 billion.
NAB Asset Servicing recorded a decline in this segment for the six months to 30 June 2015, down one per cent to $104.00 billion.
The Australian custody and administration sector continued to grow in the six months to 30 June 2015, up 7.7 per cent.