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What implications does the regulation have on the Securities Services business?
The new standards entail a significant shift in the depositaries market in
Spain, and therefore our activities as a depositary. The following implications
are the most notable:
1.
Firstly, a
significant increase in costs,
deriving from new and
more frequent controls:
•
An increase in requirements for the delegation of custody,
•
new requirements for monitoring operations
•
and new obligations relating to non-custodial assets
involving investments in technological infrastructure, but which
significantly increase the investor’s level of protection.
2.
Secondly, greater
“strict liability”
compelling depositaries to react if
assets under custody are lost, and replace them for others of equal
value as soon as possible. Banks that want to continue to carry out
this activity must do so with a solid grounding in capital and provi-
sions, allowing this operational risk to be covered.
3.
And thirdly,
corporate changes and changes in governance
stem-
ming from the model of separating the depositary and manager.
All these aspects point towards the need for
greater specialisation and
professionalism,
and a larger critical mass as keys to taking on the role
of depositary. At Cecabank, we are ready for it.
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