The move by BNP Paribas Securities Services to offer third-party clearing and local custody in Hong Kong -- for which it received approval earlier this month -- is part of a wider strategy for Asia.
Jacques-Philippe Marson, chief executive of BNP Paribas Securities Services in Paris, says the institution plans to expand in China, Japan, South Korea and Taiwan over the next three to four years. The firm is exploring acquisition or partnership opportunities to facilitate this growth.
Marson is unconcerned about competition from more established securities services providers in Asia-Pacific, including BNY Mellon Asset Servicing and State Street. "American providers are not used to the different cultures, the different structures and fragmentation of Asia," he says. "These providers are good for Anglo-Saxon markets."
BNP Paribas Securities Services' experience working with the different cultures and market fragmentation in Europe makes it a better fit for Asia, Marson says.
The firm began its expansion into Asia two years ago from its base in Australia. Hong Kong will be the company's first branch in the region to offer third-party clearing services.
"This is a significant new step to our regional expansion strategy," says Jean-Marc Pasquet, Asia-Pacific head of BNP Paribas Securities Services in Sydney. "It reinforces our commitment to provide clients with the benefits of our global expertise in a local context -- especially through innovative services such as third-party clearing."
Currently the service provider's Asia-Pacific presence includes Australia, Hong Kong, India, Japan, New Zealand and Singapore.
As of the end of last year, the provider had $4.65 trillion in assets under custody and $786 billion in assets under administration globally, but Asia remains a small percentage of its global revenues.