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does not attract a lot of responses in Muscat, but those it does
receive are flattering. Though respondents acknowledge that
FAB has yet to become a natural choice for network managers
and their clients, the only service vulnerabilities they detect lie
in an area where no sub-custodian excels: asset servicing. FAB
is, after all, an AA-rated bank with an inescapable commitment
to the region. But even for FAB, Oman is the market to which
its balance sheet is the least exposed of the six Middle Eastern
countries where it operates. HSBC
HSBC first entered this market in 1996, and its presence here
testifies to its continuing confidence in the growth of Asian
trading networks in general, and the burgeoning trade between
Bangladesh and China in particular. The bank did not attract
enough responses to be rated here this year. The detail suggests
clients nevertheless believe it is relatively easy for them to open
an account, that their trades will settle on time, that their assets
and their data are in safe hands, and that HSBC technology is
adequate to meet these needs.
Asia KAZAKHSTAN
Kazakhstan is the biggest economy in central Asia. It has oil,
but is making conspicuous efforts to diversify, especially by
attracting foreign investment with tax incentives. The country
knows it is well-positioned geographically, especially if the
Chinese Belt-and-Road strategy moves beyond the realm of
rhetoric and investing in its infrastructure to capitalise on its
location. An international financial centre opened in Astana in
July last year. The Kazakhstan Stock Exchange (KASE) dipped
last year after hitting its all-time early high last summer, though
it has recovered in 2019. The economy is sensitive to the oil
price, as investors found in the past, but it is back to growing at
a steady clip of more than 4% – which explains the strength of
the stock market.
BANGLADESH
Whether Bangladesh can transform its undoubted growth
potential into reality depends on multiple factors, not all of
which are under local control. But multiple factors, ranging from
privatisation, through more effective regulation of the stock
market by the Bangladesh Securities and Exchange Commission
(BEC), to the encouragement of domestic mutual and pension
funds, undoubtedly are under local control. Reforms could do
much to help the Dhaka exchange break out of the pattern it has
traced since the broad market index peaked in 2011: that of a
crab rather than a rocket.
Standard Chartered Bank
Standard Chartered easily eclipses its principal rival here, top
scoring in Dhaka in every service area by wide margins and
clearing the global benchmarks in most (See page 78). That
said, the bank could clearly do better in cash management and
foreign currency execution and needs to invest more in staff
training. Clients would also like to see keener pricing. But
these are eminently fixable shortcomings in a market where
foreign portfolio investment has yet to catch up with rising
levels of direct investment by multinationals in Bangladeshi
infrastructure, giving Standard Chartered the benefit of time
to readjust.
70
Global Custodian
Spring 2019
Raiffeisen Bank International
Raiffeisen first tackled the Kazakh market as long ago as 2001,
when it acquired a stake in Bank TuranAlem (BTA). That did
not come to anything but, unlike some other banks who came
here before the crisis, Raiffeisen never lost interest. That bet
looks like paying off. The bank finally added a securities ser-
vices offering to its corporate banking operations in Almaty in
2014, using Raffeisenbank Russia to open cash and securities
accounts at the Central Securities Depository of the Kazakh-
stan Republic (KACD). With Russia now operating as a hub
for the services of the bank throughout the region, Raiffeisen
still operates that way here. Though not many clients have
responded to the survey, those that have indicate the model
works well. The scores imply that accounts are easy to open,
transactions settle on time and assets are kept safely. Only pric-
ing shows any serious signs of discontent. The overall score is
well upon a year ago.
Citi
Citi provides direct clearing and custody services here, but not
enough clients have responded to the survey to make an assess-
ment.