While global results are similar year-on-year, the latest Agent Banks in Emerging Market (ABEM) survey, published this week, shows attitudes shifting with regards to asset safety and pricing.
Sub-custodians were scored relatively poorly for asset safety in 2018 in the midst of relative global economic and political turmoil. However, it has now moved up the table from the least regarded aspect of emerging market service provision, suggesting that investors are either more confident in the emerging market investment environment or, at the very least, are reconciled to the risk they are required to take in pursuing yield.
Conversely, pricing is now an area of complaint, with respondents querying the costs of post-trade services they are buying in from third parties.
This is the 30th consecutive year in which Global Custodian has published a survey of client perceptions of the quality of securities services in individual markets. Over the years, the survey has expanded and is now presented in three segments: major markets (Fall edition); emerging markets (Winter edition) and frontier markets (Spring edition).
The 2019 ABEM survey is the final project in a two-year collaboration with McLagan Investor Services and represents a joint effort, with McLagan providing the data analysis and Global Custodian managing the survey process and writing the commentary.
ABEM covers 12 service categories with respondents asked to agree or disagree with a series of propositions along a scale from ‘strongly disagree’ to ‘strongly agree’. The results have been converted to Global Custodian’s familiar 7-point scale (where 1=unacceptable and 7=excellent).
For GC subscribers, the full survey results are available here.