latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/global-securities-services-banks-revenues-hit-6-year-high-in-2018-51127281 content
Log in to other products

Login to Market Intelligence Platform


Looking for more?

Contact Us

Request a Demo

You're one step closer to unlocking our suite of comprehensive and robust tools.

Fill out the form so we can connect you to the right person.

If your company has a current subscription with S&P Global Market Intelligence, you can register as a new user for access to the platform(s) covered by your license at Market Intelligence platform or S&P Capital IQ.

  • First Name*
  • Last Name*
  • Business Email *
  • Phone *
  • Company Name *
  • City *
  • We generated a verification code for you

  • Enter verification Code here*

* Required

Thank you for your interest in S&P Global Market Intelligence! We noticed you've identified yourself as a student. Through existing partnerships with academic institutions around the globe, it's likely you already have access to our resources. Please contact your professors, library, or administrative staff to receive your student login.

At this time we are unable to offer free trials or product demonstrations directly to students. If you discover that our solutions are not available to you, we encourage you to advocate at your university for a best-in-class learning experience that will help you long after you've completed your degree. We apologize for any inconvenience this may cause.

In This List

Global securities services banks' revenues hit 6-year high in 2018

Street Talk Episode 68 - As many investors zig away from bank stocks, 2 vets in the space zag toward them

Street Talk Episode 66 - Community banks tap the debt markets while the getting is good

Street Talk Episode 67 - Veteran investor tabs Mick Mulvaney to help with latest financial stock-focused fund

Street Talk Episode 65 - Deferral practices trap US bank portfolios in purgatory

Global securities services banks' revenues hit 6-year high in 2018

The top 12 global securities services banks saw their 2018 revenues grow at their fastest rate and hit their highest level since 2013, according to a sector index released by research firm Coalition on April 11.

The index tracks the following major North American and European institutions: Bank of New York Mellon Corp., Citigroup Inc., JPMorgan Chase & Co., Northern Trust Corp., State Street Corp., Brown Brothers Harriman & Co., Royal Bank of Canada, HSBC Holdings PLC, BNP Paribas SA, Société Générale SA, CACEIS Bank SA and Deutsche Bank AG.

Total annual securities services revenues at these banks rose by 9% year over year to $37.2 billion in 2018. The annual rate of increase stood at 7% in 2017 when revenues reached $34.3 billion and was only 3% in 2016 with revenues at $31.9 billion.

The main drivers of the revenue growth in 2018 were higher equity markets, rising transaction volumes and improved net interest income, according to Coalition. S&P Global Market Intelligence and Coalition are both owned by S&P Global Inc.

The securities services business was less affected by the tough market conditions observed in the first quarter of 2019, which were particularly damaging to global investment bank's origination and advisory business, Eric Li, research and analytics director at Coalition said in an interview.

Securities services are expected to remain more resilient to the market headwinds later in 2019 as well, he added.

Custodian banking outperforms

The strong asset value increase in equity markets boosted the earnings of securities services banks, as the fees they charge for safeguarding clients' assets are based on the aggregate value of those assets. The net interest income growth largely stemmed from rising interest rates, most notably in the U.S. and Asia, according to Li.

Apart from a significant increase in net interest income, revenues in Asia-Pacific were also driven by strong volume growth. The Americas grew at a slower pace despite the boost coming from rate hikes and equity markets due to idiosyncratic challenges for the industry such as fee concessions, Coalition's analysis showed.

On a product-by-product basis, custody services accounted for the bulk of the total revenue growth, booking a 12% year-over-year revenue rise to $19.4 billion in 2018.

Fund services saw a 4% year-over-year increase to $10.0 billion. Revenues from other securities services, including corporate trust, depository receipt, agency securities lending, broker/dealer clearing and settlement, and collateral management, grew by 7% year over year to $7.7 billion.