BNP Paribas Securities Services, the French bank’s pension scheme custodian business, is to launch a depositary banking service in Switzerland.
The move will see the provider focus on depositary services for its asset-owning clients domiciled in Switzerland.
This latest expansion follows the launch of a similar service in the UK and the Netherlands.
In late 2013, it also confirmed the purchase of Commerzbank’s depositary banking arm, giving it access to the German market.
Under the Alternative Investment Fund Managers Directive (AIFMD), which came into force in July last year, investment funds not using a UCITS approach much appoint a depositary bank.
This is to ensure the safekeeping, cash monitoring and oversight of assets.
As AIFMD funds grow in number, with the regulatory rollout continuing across the EU, the number of pension schemes requiring these services increases, fuelling BNP’s strategy.
Garrick Smith, who heads up the bank’s new Switzerland operation, cited growing demand for a consolidated approach for operational services such as depotbank and custody.
“We have already won our first depotbank mandate in the market, from one of the biggest independent fund of fund managers in Switzerland,” he said. “With this expansion, we underline our commitment to the Swiss market.”
This follows a trend of BNP expanding services on the back of changes to regulation.
In October 2012, it announced the launch of a local custody service in the US, providing post-trade services to institutional investors.
At the time, the bank said the Dodd Frank Act, which implemented reform in response to the financial crisis, created a “whole range of opportunities”.