When it comes to standard services that clients take for granted nowadays there is little to choose between the three or four top players in each market. Five years ago clients could pick out the best custodian by ticking off a list of technical requirements. Today it's the intangibles that count, things such as having skilled people on the ground, good relationship with local authorities and being able to represent the clients' interests at all times. For many clients, these intangible qualities are the reasons why HSBC remains the lead sub-custodian among the other providers that they also use in the region.

Operating in 27 markets, 18 of which are in Asia, HSBC services institutional clients worldwide, including every major global custodian and international broker-dealer. While its custody and settlement ability is the equal of any first class providers, its entrenched presence in Asia is second to none. Its sheer size, with 1000 staff globally, allows excellent career development and effective transfer of best practices. Its senior management team has been working closely together for more than seven years, making it possibly the oldest partnership in the custody business in Asia. Perhaps it's for these reasons some clients believe HSBC has far better relationship with the regulators and other market participants than many competitors in the region, and can lobby for changes on their behalf more effectively.

One self-proclaimed "demanding client" says HSBC is flexible in most markets in terms of providing customized procedures and reporting services, and aggressive on meeting deadlines.

Another area that HSBC excels is pricing. "It's more important than it used to be because foreign investors are more sophisticated now and their products have become more commoditized as we move from very risky physical market to less risky book-entry scripless market," one client says. "The differentiation between the banks and their bread-and-butter services is not so great. So HSBC's competitive pricing has become more important for us," he adds.

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