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Sub-custodian network management in a post-pandemic world
This paper describes a vision for sub-custodian network management in a post-pandemic world. It examines how the COVID-19 crisis affected risk assessment functions and the approach to due diligence. It also considers the wider roles network managers play in market advocacy, intelligence gathering, relationship management and infrastructure development, and looks at whether the global pandemic has accelerated a bifurcation of these roles. It makes the case for continued on-site meetings when the pandemic ends and examines new considerations for such visits. It goes on to explore some of the components that will shape the future evolution of the network manager, including the impact of digitalisation and technological innovation and trends and themes transforming the custody business itself. Successful network managers should embrace the digital paradigm, and support and enable their sub-custodians to do the same. As sub-custodian business models change and markets evolve, network managers should continue to leverage their high level of market expertise to support their own organisations in their decision making. Network managers should increasingly become agents of change, as they navigate new complexities and identify opportunities for key stakeholders across the sub-custodian network.
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Andrew Osborne joined Northern Trust in 1993. As Global Head of Network Management, he manages the global team overseeing Northern Trust’s network of sub-custodians and payment banks in over 100 markets. In this role he is responsible for the assessment of infrastructural and operating risk in each market and for the selection and ongoing management and service delivery of each agent bank relationship. Andrew represents Northern Trust at the Association of Global Custodians (AGC), a group of international banks focused on the development of legal, regulatory and infrastructural matters that affect global custodians and their clients. He served as chairperson of the AGC 2003–4.