Asset Servicing Global Market Report 2023

NEW YORK, Feb. 23, 2023 /PRNewswire/ --

Major players in the asset servicing market are National Australia Bank Limited, CACEIS, BNY Mellon, HSBC, JP Morgan, Citi, The Bank of New York Mellon Corporation (BNY Mellon), State Street Corporation, UBS, and Clearstream (Deutsche Börse Group).

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The global asset servicing market will grow from $1159.45 billion in 2022 to $1277.82 billion in 2023 at a compound annual growth rate (CAGR) of 10.2%. The Russia-Ukraine war disrupted the chances of global economic recovery from the COVID-19 pandemic, at least in the short term. The war between these two countries has led to economic sanctions on multiple countries, surge in commodity prices, and supply chain disruptions, causing inflation across goods and services effecting many markets across the globe. The asset servicing market is expected to grow to $1830.69 billion in 2027 at a CAGR of 9.4%.

The asset servicing market consists of revenues earned by entities by providing administration services through a central securities depository (CSD) or custodian in connection with the custody and/or safekeeping of financial instruments (e.g., the processing of corporate events or the handling of taxes) on a fee or commission basis. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

Asset servicing refers to a set of tasks and activities performed by a custodian for his clients in relation to the assets in his custody.

North America was the largest region in the asset servicing market in 2022.Western Europe was the second largest region in the asset management market.

The regions covered in the asset servicing market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, and Africa.

The main services offered in asset servicing are fund services, custody and accounting, outsourcing services, and securities lending.Securities lending is the process of lending shares of stock, commodities, derivative contracts, or other securities to other investors or firms.

The borrower must put up collateral in the form of cash, other assets, or a letter of credit when applying for a security loan. The services are offered to large enterprises, medium-sized and small enterprises, capital markets, and wealth management firms.

Globalization acts as a major driver for the growth of the asset servicing industry.According to a study on global asset servicing, nearly 60% of asset services in Assets Under Administration (AUA) and Assets Under Contract (AUC) predict that globalization is likely to be a strong driver for the asset servicing market's growth over the coming years.

The players dealing in the asset servicing industry are majorly focusing on the APAC markets and other growing economies.Moreover, according to the BNP Paribas Securities Services article published in January 2020, India was expected to experience impressive growth in the asset management and servicing industry owing to the increasing working population, the rising buying power of the populace, and expected growth in the GDP of the country.

Thus, globalization creates a large avenue for the expansion and growth of the asset servicing market over the coming years.

The stringent regulatory framework is predicted to limit the growth of the asset servicing industry over the forecast period.According to Funds Europe's asset servicing roundtable, rising global regulation is adding cost and risk to asset servicing, creating a requirement for asset servicers to constantly engage with clients and regulators.

In addition to this, according to EY's new opportunities for asset servicing study, nearly 75% of the companies see the impact of regulations as the greater risk facing the asset servicing industry. Therefore, the increased scrutiny from regulatory agencies is anticipated to hinder the asset service market's growth in the coming years.

Robotic process automation (RPA) or automation is a major trend shaping the growth of the asset servicing market.Robotic process automation alone could reduce the headcount by 60–70% in the asset servicing industry while also achieving cost savings of approximately 30–40%.

Robotic process automation (RPA) refers to a set of software tools known as bots or robots that are used to perform a repetitive or routine business process that is currently used by transaction processing teams or service centers.RPA can replace manual tasks involved in asset servicing such as reconciliation, trade processing, and reporting for regulators and clients, reducing the time required with cost-efficiency.

For instance, the ANZ Banking Group was one of the early ones to adopt RPA aggressively and automated its HR, finance, and technology processes in its Bengaluru hub, creating thousands of bots.

In April 2020, JP Morgan sought to take whole ownership of China International Fund Management (CIFM), a local asset management firm, for an amount of $1 billion.This step was taken following China's reforms on the elimination of caps on foreign companies' taking full control of local asset management operations.

This acquisition is expected to enable JP Morgan's long-term involvement with CIFM and strengthen the company's position in the Chinese market. China International Fund Management (CIFM) was founded in 2004 and offers asset management and related services to China.

The countries covered in the asset servicing market are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, and USA.

The market value is defined as the revenues that enterprises gain from goods and/or services sold within the specified market and geography through sales, grants, or donations in terms of currency (in USD ($) unless otherwise specified).

The revenues for specified geography are consumption values – that is, they are revenues generated by organizations in the specified geography within the specified market, irrespective of where they are produced. It does not include revenues from resales either further along the supply chain or as part of other products.

The asset servicing research report is one of a series of new reports that provides asset servicing statistics, including asset servicing industry global market size, regional shares, competitors with asset servicing shares, detailed asset servicing segments, market trends and opportunities, and any further data you may need to thrive in the asset servicing industry. This asset servicing research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

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