UMB Institutional Custody Business Grows to $250 Billion Assets Under Custody
Led by Executive Vice President, Executive Director of Institutional Custody
Key growth drivers include:
- Strong client growth in municipal government and insurance sectors
- Increasing popularity of private funds and semi-liquid funds
- Need for liquidity solutions among asset managers, including reverse repo and, in collaboration with UMB’s commercial bank, lines of credit
Many municipal governments and asset managers are now managing more complex investment portfolios than in past years and need additional middle-office services such as risk monitoring, collateral management, and treasury/liquidity support functions. This is clearly demonstrated by the significant growth UMB has experienced in this area.
“In addition to size, increased complexity is driving the need for specialized services for government and other political subdivisions,” Small said. “We’ve seen a similar evolution of business needs among insurance companies, where middle-office services often focus on non-traditional asset servicing for alternative investments, foreign exchange capabilities, regulatory reporting, securities lending, and collateral management.”
Most recently, the
“The City of Fort Worth manages a large and increasingly complex investment portfolio, and having a strong custodial partner is essential to maintaining effective oversight, liquidity, and operational efficiency,” said
UMB’s business has also grown as asset managers seek specialized support for private and semi-liquid funds. For these complex assets, robust middle-office services are crucial to an asset manager's operational efficiency. Some conversions from other custodians have involved bringing hundreds of funds and their corresponding demand deposit accounts (DDAs).
“Until 2018, UMB’s custody function was an add-on service for clients of
Finally, liquidity solutions among asset managers continue to have high demand as asset managers navigate volatile markets—a trend that is driving growth for UMB’s custody and commercial teams. UMB offers both reverse repo and line of credit liquidity options for insurance companies, asset managers and other institutions that have custody assets with UMB. Notably, UMB offers committed reverse repo facilities in addition to the more common uncommitted facilities.
These complementary services recently resulted in UMB attracting a major, third-party provider of liquidity solutions to asset managers. In
“UMB has been nothing short of amazing to work with,” said
As Institutional Custody has grown as a standalone business segment within UMB, the team has broadened its offerings and enhanced its technology, including:
- Developed enhanced straight through processing capabilities
- Launched in-house foreign exchange services
- Introduced self-service options for client convenience
- Added collective investment trustee services
- Expanded directed trustee role for insurance and pension clients
- Broadened ETF full-service capabilities
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Implemented
FDIC sweeps for overnight cash balances - Integrated custody and treasury platforms
“As the industry landscape and business needs continue to evolve, we are extremely focused on being proactive and mindful of what this means for our clients and how we can strategically serve and advise,” Small said. “While we excel at completing the work we know and have today, we’re equally intent on ensuring we understand and plan for how we serve our clients’ future needs as well. We expect this, along with our continued focus on evolving with the industry and delivering best-in-class services and expertise, to continue to drive our business success now and in the future.”
About UMB:
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Media Contact
Stephanie.Hollander@umb.com
816.729.1027
Company Contact Details
816.860.7000
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