BNY Mellon pursuing “open architecture” in custody

BNY Mellon recently announced a partnership with Bloomberg, which comes on the heels of another with BlackRock.


The aim, says Singapore-based Mathew Kathayanat, head of product and strategy for Asia Pacific, is to provide value by bringing critical data and insights into the front office, allowing clients using both BNY Mellon and its partners to improve the investment-decision process. “We’re open architecture because we know our clients want flexibility and choice,” he said.


Custody represents the primary revenue generator for the world’s biggest banks. Custodians act as the vault for institutional and corporate accounts, safeguarding assets, collecting and reporting on related information (such as corporate actions), providing accounting, maintaining funds’ registrars, handling foreign exchange, and providing a range of legal, tax and compliance services related to those funds.



Although fees on core custody are ultra low, the volumes that top banks generate still makes custody valuable. Despite low interest rates, custodians still earn a spread on holding customer deposits, and lending out client assets (splitting the gains with the client) is lucrative. During the global financial crisis, custody provided steady revenues at a time when other banking activities were in peril.

Mellon hold your master account but the open architecture means you move in and out of outside funds.  OK, by why wouldn't I just handle account management with a spreadsheet and my Secure ID?