SERVICES

Those of us employed in the financial sector know that our industry is expansive in products and services, how those services are delivered, pricing of services, and the technology behind service delivery.  Like other industries, we have developed our own language, full of acronyms, slang and highly technical sounding vocabulary.   It comes as no surprise then when we find clients who indicate that they really don’t understand what custody is or what the important factors in custody are.   Consequently, we would like to provide our website visitors with a little background about the service, a few suggestions for how you might evaluate a custody provider, and information about Mission’s capabilities.

What is securities custody?

In a nutshell, custody is the legal responsibility for someone else’s assets. The term implies management as well as safekeeping.  A financial institution that is a custodian holds custody to stock certificates and other assets of a corporate client, individual, trust, or mutual fund.  Among other things, the custodian is responsible for accurate recordkeeping and accounting of the assets, timely delivery of securities, collection of income, tax reporting, trade settlements, pricing of securities, safekeeping of the assets, and reporting to the client.

The background for the name of the service, "custody," originates from past days when banks would hold stock and bond certificates in safekeeping, or in their "custody" in their vaults on behalf of clients.   This was an important service that provided clients with peace of mind, protecting the assets from unauthorized transactions or destruction.   Custody facilitated the purchase and sale of securities because the client could provide instructions about the disposition of specific securities and the bank would perform those transactions as instructed.  As the securities and banking industries became more computerized, the role of the custodian moved out of the bank vaults and into the computer.  Today, custodians maintain the documentation and accounting for client assets that exist only as bits of information in huge industry databases.  The ability to access and interact with those databases allow for efficient movement of securities traded from one owner to another, substantially reducing the costs of providing these services to clients.

No different than years past, custodians today are still responsible for safekeeping a client’s assets.  However, the methods used to perform this service are quite different.

What should I be looking for in a custodian?

First and foremost, select a custodian who will meet your needs as a client and will provide you with personalized service. The service capabilities of most custodian institutions vary little from one another.  As a result, we suggest you emphasize service, making sure the custodian can custom-tailor account structures, reporting and other servicing directly to your needs.

You should have confidence that the custodian will have experienced, professional staff handling the administration of your account and operations behind the scene.  Make sure that the firm can handle the kinds of investments you expect to have in your portfolio and that reporting will be accurate and timely.  Consider carefully those firms that emphasize custody as an important business line, not a side product of being in banking.

If you would like additional suggestions for how to select a custodian, please E-mail us for more information and we will send you sample questions.

Tell me about Mission’s custodial capabilities.

Mission offers a full range of services relating to both domestic and global securities custody, including sub-accounting, short-term investment vehicles, online access to portfolio information, and securities lending.  Some of our core domestic custody capabilities include:

Mission offers the highest level of security for assets.  Through its connection with U.S. Bank, Mission has an automatic interface with all major depositories.  Being part of this sophisticated securities trading and settlement network enables Mission to process any securities related activity, trade settlement, income collection, or corporate action in an accurate and timely manner.

Mission utilizes SunGard for trust and custody accounting and reporting systems. SunGard’s "Charlotte" system is a multi-purpose trust accounting system, currently in use by over dozens of trust operations across the country.   One of the three largest trust system providers in the country, SunGard fully supports all software maintenance and product enhancements.

For each of the services listed above, Mission can provide you with a detailed explanation of how we would service your relationship and the options available to you as a client.

Electronic mail

General Information: info@missiontrust.com