Home / News / NAS sale falls through (again)

NAS sale falls through (again)


Talks between NAB Asset Servicing and HSBC for the latter to take charge of the former’s 30 largest clients have allegedly faltered.

HSBC was understood to be looking to do a deal similar to that which Citi completed last year with Royal Bank of Canada (RBC) whereby it took over almost all of the former RBC asset servicing clients in Australia. But the deal, first rumoured in March is off – for reasons currently unknown. However, NAS will still make an effort to simplify its business by pushing at least 30 of its smaller clients onto other custodians.

As to why the sale fell through, your guess will likely be as good as ours – though a sticking point in past attempted sales (of which there have been a great many) has been the lucrative cash and FX part of the business, which NAS has historically tried to keep. The highest bid ever made for NAS – which currently sits at fifth on the Australian Custodial Services Association table – was around $1.6 billion, from State Street. That bid included the cash and FX business, which goes hand in glove with custody. But nobody is going to pay a lot of money for the core custody business without the value-add services.

NAS has also previously rebuffed offers from J.P. Morgan as far back as 2003, in a plan known by J.P. Morgan as “Project Mexico” (south of the border) which would result in NAS running J.P. Morgan’s own domestic custody business and the US bank taking over NAS’ global custody, then run by BNY Mellon. NAS has also turned down at least one other offer from State Street since.

HSBC recently recruited State Street veteran Sinclair Scholfield for an expected expansion of its Australian master custody business, and the NAS acquisition would have given it significant scale to compete in what other custodians are describing as a time of “chunky winners and losers”. Still, it’s not all bad news for HSBC; its appointment as global custodian to ETF Securities, announced earlier this week, will come as something of a consolation prize.

HSBC declined to comment. NAB did not provide comment before deadline.

Print Article

’60/40 is being resuscitated’: fixed income down but not out

Year-to-date, fixed income markets are about as bad as equities. But Michael Leithead, fixed income and senior portfolio manager at EFG Asset Management (EFGAM), is more positive than he’s been “in a long time.” “We’re at a point now where the market has priced in quite a lot of global policy tightening, and that restores…

Lachlan Maddock | 24th Jun 2022 | More
‘It’s a business about character’: Kudu hunts deals Down Under

New York-based Kudu Investment Management has returned to Australia in hopes of pulling off a repeat of its 2020 deal with Channel Capital. “The asset management business is an absolutely beautiful business, to the mind of anybody involved in it. It’s rock solid; it has high margins; and the people are interesting,” says Charlie Ruffel,…

Lachlan Maddock | 24th Jun 2022 | More
APRA grows concerned on consolidation, flags new standards

The wave of consolidation racing through the superannuation industry is now raising eyebrows at the prudential regulator. With the massive amounts of FUM being devoured, some funds are suffering indigestion. “This may manifest at the industry level at the point of transfer in a SFT, for example where an administrator has a backlog of transfers…

Lachlan Maddock | 24th Jun 2022 | More
News and OneVue go live with brightday
Investor Strategy News | 11th Jan 2015 | More
Perrignon off to HK with Credit Suisse
Investor Strategy News | 22nd Dec 2013 | More
Sports betting as a new asset class
Investor Strategy News | 3rd Jul 2016 | More
BlackRock ahead of consensus with bullish view
Investor Strategy News | 14th Jan 2017 | More
HSBC talks re-open old NAB wound
Lachlan Maddock | 9th Mar 2022 | More
Statewide seeds bespoke Apostle fund
Lachlan Maddock | 23rd Mar 2022 | More