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Assets Custody Business
  Overview
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  Home Page > Corporate Banking >Assets Custody Business >Overview
Overview
 

I. Description
Asset custody refers to safekeeping of customer assets and rendering of clearing, accounting, valuation and supervisory duties and other services related to investment management under the customer's entrustment.

After more than a decade's development, the asset custody market has been growing rapidly in the Chinese Mainland, witnessing the scale of assets under custody rocketing from less than RMB1 billion at the beginning to over RMB9.1 trillion at the end of September 2015. Meanwhile, as China's capital market steps up its internationalization pace and more and more financial innovations emerge, custody is increasingly used as an important governance means. More and more individual investors, financial institution investors and businesses resort to safe and efficient custody services.

On February 24, 1998, ICBC became the first custodian in the Chinese Mainland upon approval of the China Securities Regulatory Commission (CSRC) and the People's Bank of China (PBOC). As a custody pioneer, ICBC, which has always been adhering to “integrity and diligence”, boasts rigorous and scientific risk management and internal control systems, regulated business management model, advanced operation system and a professional team. It provides safe, efficient and professional custody services for investors, financial asset management institutions and corporate customers at home and abroad, demonstrating its sound market image and great influence and winning standing reliance and respect from customers.

ICBC, which provides the most various asset custody services in the biggest size and of the best quality, has maintained the biggest market share for 17 consecutive years. As at the end of September 2015, assets under its custody exceeded RMB9,131.1 billion. With a complete range of custody products, ICBC took the lead in China in launching such value-added services as performance evaluation and risk management and other individualized custody services for different customers. ICBC plays a leading role in market innovation. Since the launch of custody services, it has participated in the development and custody of most innovative products in China. ICBC is also the first bank that passed the International Standard on Assurance Engagements (ISAE) No. 3402 (the former SAS70) and made it an annual practice, and the first that launched and regularized disaster recovery drill for asset custody in China. Its innovation capability, service quality and risk control ability are highly recognized on the market.

In active response to customer needs, ICBC is committed to rendering the most professional custody services for excellent capital market players. Through building a global custody services network, ICBC has spread its custody services throughout China and the world, including extensive basic and value-added services for customers.

Scope of domestic asset custody services
Basic services: account opening, asset safekeeping, investment clearing, accounting, asset valuation, trading supervision, centralized payment, information disclosure etc.

Value-added services: investment assessment, performance evaluation, risk analysis, information consultancy, individualized statement preparation etc.

Scope of global asset custody services
Basic services: account opening, asset safekeeping, transaction settlement, accounting, asset valuation, corporate information, trading supervision, foreign exchange conversion, income receiving, record keeping, reporting and agency voting, etc.

Value-added services: performance evaluation, risk management, cash management etc.

II. Organizational Structure and Service Team
The Asset Custody Department consists of General Administration Division, Securities Investment Fund Division, Trust Asset Division I, Trust Asset Division II, Global Asset Custody Division, Product and System Development Division, Information and Value-added Service Division, Transaction Supervision and Risk Management Division, Operation Division I, Operation Division II, Operation Division III and Outsourcing Center, as well as five custody subsidiaries in China.  At present, all of ICBC's 37 domestic tier-one branches (branches directly controlled by the Head Office) offer asset custody services and some overseas branches are also able to render such kind of services.

As at the end of September 2015, the Asset Custody Department had 203 employees at headquarters, over 90% of which had bachelor's degree or higher and qualifications for dealing in funds. All departmental managers and above have postgraduate degree or higher, or senior technical titles. 

With spirits of innovation, ICBC's asset custody team has put forward many business proposals, some of which have become yardsticks in the domestic custody industry. With rich experiences and professional service teams, ICBC has its presence as custodian representative in many regulators and counselors in the industry:

Part-time Vice Chairman of Asset Management Association of China;

1st Director of Custody Business Committee of China Banking Association;

Joint President of Practical Norm Team of China Securities Market (CN SMPG);

Member of Fund Committee of Securities Association of China;

Member of Insurance Asset Management Association of China;

Leader of Shadow Pricing Team of Money Market Funds;

Leader of Valuation Team of Securities Investment Funds;

Member of Industrial Standards Team of Electronic Fund Disclosure;

Product Valuation Specialist of Shanghai Clearing House;

First Chairman of Custodian Committee of Enterprise Annuity Branch of China Social Insurance Association;

Only Custodian Bank Member of Occupational Annuity Investment and Operation Study Team of Ministry of Human Resources and Social Security;

Leader of Industrial Standard Implementation Team of Pension Insurance Fund Supervisory Information of Ministry of Human Resources and Social Security.

III. Advantages
1.As the earliest asset custody bank in China, ICBC has rich experiences
On February 1998, ICBC became the first bank in Chinese Mainland that obtained securities investment fund custody qualification upon the approval of CSRC and the PBOC. In March 1998, it was the first bank in China providing custody services for China-Kaiyuan Fund and Jintai Fund. With the opening up and rapid development of China's securities market, ICBC's custody services grew rapidly, leading domestic peers.

2.As the best custodian bank in China, ICBC has brand advantages
During the annual comprehensive assessment on fund custodian launched by CSRC and the PBOC, ICBC always ranked the first in the industry. Since 2004, ICBC has won a total of 48 best custodian awards granted by domestic and foreign authoritative financial media, the custodian bank that obtained the most awards in China.

3. As the largest asset custody bank in China, ICBC has market advantages
As at the end of September 2015, assets under ICBC's custody exceeded RMB9,131.1 billion. ICBC has maintained the biggest market share for 17 consecutive years. With a complete range of custody products, ICBC has become the custodian bank that provides the most various asset custody services in the biggest size.

4. With the widest customer base in China, ICBC has customer advantages
ICBC has established a long-term cooperation relationship with domestic securities companies, fund management companies and other institution and enterprise customers. It has developed diversified bank-securities cooperation, bank-trust cooperation, bank-fund cooperation and bank-insurance cooperation and is the major member in domestic inter-bank bond market, inter-bank borrowing/lending and securities mortgage financing market. It has established close cooperation in custody business with many medium and large-sized financial institutions and large enterprise groups and has become the custodian bank with the most customers in China, highly recognized by customers.

5. By pioneering in the custody of nearly all innovative financial products in China, ICBC has innovation advantages
Since 1998, ICBC has pioneered in launching custody services of index fund, bond fund, principal guaranteed fund, money market fund, LOF, ETF, clone fund, innovative close-ended fund and other innovative products. It has become the first bank that rendered whole-process and full-amount custody services for insurance assets, the first QFII, QDII and ESCROW asset custodian bank, the first enterprise annuity fund custodian bank and also one of the first asset securitization product custodian banks. It has followed closely the innovative development of market and satisfied customers' needs to the greatest extent.  

6. As the largest clearing bank in China, ICBC has advantages in capital operation efficiency
With the advanced fund clearing system, ICBC is the commercial bank with the largest settlement volume in China. The fund clearing service in ICBC's custody services can support SPT based on ICBC's powerful fund settlement network and clearing system, which could avoid the risk of fund in float and manual clearing and ensure the secure and speedy fund clearing service. CNAPS is applied to ensure the rapid, secure and reliable system payment in the inter-bank clearing of assets under custody.

7.With powerful custody information systems, ICBC has technological advantages
ICBC is the only commercial bank with in-house custody business system in Chinese Mainland and has developed and launched five versions of integrated custody business system. The forth version of custody system developed by ICBC was launched in July 2007, which supported new and old international accounting rules and technologically guaranteed the global custody services under multiple accounting rules, on multiple markets, with multiple valuation methods and multiple reports. The fifth version of custody system was launched in July 2011, signaling that ICBC became the first Chinese custodian bank that adopted standardized processing methods. Moreover, ICBC rolled out the overseas extension project (Hong Kong II) of global custody system and made ICBC (Asia) be ready to develop basic custody services in Hong Kong.

8. By establishing a solid asset custody risk prevention system, ICBC has risk control advantages
In the custody services, ICBC has always been regarding the risk management on par with the business development. It constructed and launched a multi-level asset custody business risk system. In 2005, ICBC was the first Chinese bank that introduced and passed the international certification about internal control audit, Statement on Auditing Standard 70 (SAS70), and used it as a routine internal control measure and a regulation. Since successfully implementing the first disaster recovery emergency drill in China's custody industry in 2007, ICBC has done this every year. It also pioneered in launching disaster recovery emergency random drills for custody services in 2009. The disaster recovery emergency drill has become a routine internal control measure and a regulation of ICBC, which ensures the normal and uninterrupted system running in case of emergencies or disasters.

9. With professional performance evaluation systems, ICBC has value-added service advantages
Performance evaluation and risk analysis system is one of the projects developed by ICBC in cooperation with overseas business partners. It was designed based on international standards and could obtain the powerful data information support from both ICBC and external data suppliers, thus supporting the calculation of multiple performance metrics and risk metrics. This system could satisfy the customers' needs by rendering multi-level performance factor analysis and various portfolio reports.  ICBC launched its in-house performance evaluation system (Phase I) in July 2011, the first of such kind in the industry. The system will help render quality and efficient one-stop performance evaluation services for custody business customers based on the integrated internal system platform and business processes.

10. With a powerful consultation system, ICBC has information advantages
ICBC established an information consultation management system as well as a dedicated information service team responsible for information collection and management, thus forming a multi-dimensional information service system for information consultation through Internet, telephone, tax, mail and manual service. By leveraging its business resources, ICBC set up a comprehensive and vast information database and updated the data every day. Moreover, it actively cooperated with domestic and overseas information suppliers to enhance its ability of handling global custody information.

11. By holding the post of leaders of many expertise teams and formulating many industrial standards, ICBC has professional advantages
As the first director of Custody Business Committee of China Banking Association, ICBC took the lead in advocating and organizing all member units to sign the China Banking Custody Business Self-discipline Convention. It gathered member units to actively study the hot topics in domestic custody industry and organized industry experts to complete many research projects, assuming due social responsibilities of industrial construction. ICBC's several experts in the asset custody services were engaged by many regulatory authorities and industrial associations as members of expert teams and were invited to participate in discussions as the only representatives of custodian banks in many important meetings. They contributed many opinions and comments that were recognized and adopted.

12. With a global custody network, ICBC has cross-border service advantages
Currently, ICBC has 37 tier-one branches (directly controlled by the Head Office) that are authorized to develop custody business and its domestic custody business network has been laid out. Meanwhile, ICBC actively promoted the construction of a global custody network platform and cultivated qualified overseas institutions to develop global custody business by leveraging its domestic and overseas institutions and customer resources. The global custody service network has attained preliminary scale. Moreover, ICBC strengthened the cooperation with international custodian banks and established sound cooperation with global well-known custodian banks. It led Chinese banks in terms of the development of global custody services for QFII, QDII and ESCROW, etc.

IV. History
〇 1998
In February, it became the first bank to obtain custody qualifications for securities investment fund in China.

In March, it provided custody services for the first close-ended securities investment funds in China—Kaiyuan Fund and Jintai Fund.

In March, it took the lead to launch the first-generation financial system for fund custody in China.

In March, it set up two custody subsidiaries in Shenzhen and Shanghai.

〇 2001
In September, it provided custody services for the first open-ended securities investment fund in China—China Southern Stable Growth Fund.

In September, it launched the second-generation custody business system, the first to support normal operation of open-ended fund custody in China, that is, a reasonable interconnection fund financial system.

In December, it obtained custody qualifications for social insurance fund, corporate annuity fund and entrusted assets.

〇 2002
In September, it provided custody services for the first bond fund in China—China Southern Baoyuan Bond Fund.

In November, it obtained asset custody qualifications, including trust assets, basic pension insurance fund (personal account), social security fund in rural areas, investment-linked insurance products and income & expenditure account funds.

In November, it rendered custody services for the first open-ended index fund in China—HuaAn-SSE 180 Enhanced Index Fund.

In November, it obtained custody qualifications for domestic securities investment funds of OFII (qualified foreign institutional investor).

〇 2003
In June, it provided custody services for the first principal-guaranteed fund in China—China Southern Principal Guaranteed & Value-added Fund.

In August, it obtained custody qualifications for industry funds.
In October, it launched the third-generation fund accounting & assessment system (AAS) to handle centralized data processing of its custody business across the country.

In December, it offered custody services for the first money market fund in China—HuaAn Fuli Cash Fund.

〇 2004
In October, it provided custody services for the first LOF (listed open-ended fund) in China—China Southern Active Allocation Fund.

In December, it offered custody services for the first ETF (exchange traded fund) in China—Huaxia-SSE 50 ETF.

〇 2005
In January, it provided custody services for the first insurance fund entering the securities market in China-Huatai Insurance Fund.

In February, it became the first in China to obtain custody qualifications for insurer’s equity investment upon approval of the China Insurance Regulatory Commission.

In March, it took the lead to introduce SAS70, the international audit standards for internal control, and obtained the unqualified SAS70 audit report after nine months’ review.

In August, it obtained custody qualifications for corporate annuity fund upon approval of the Ministry of Human Resources and Social Security.

〇 2006
In June, it provided custody services for the first corporate annuity fund entering the market in a compliant manner in China.

In July, it provided custody services for the first replicate fund in China-China Southern Stable Growth Fund II.

In September, it offered custody services for the first banking QDII product in China--Bank of China USD Enhanced Cash Management.

In October, it launched the Internet banking service system for custody business, extending the custody services to the client through the Internet.

In November, it provided custody services for the first securities company’s QDII product in China-HuaAn Global Allocation Fund.

〇 2007
In July, it provided custody services for the first innovative close-ended fund in China-UBS SDIC Classified Equity Fund.

In July, it signed a custody agreement with the National Council for Social Security Fund to officially manage the national social security fund.

In July, it launched the fourth-generation core custody system-custody financial management system independently designed and developed by ICBC with complete intellectual property right.

In September, it provided custody services for the first fund company’s equity QDII fund in China-China Southern International Select Allocation Fund.

In October, it launched the asset custody transactions supervision system (CARC) independently designed and developed by ICBC with complete intellectual property right.

In December, it staged the first inter-city disaster recovery drill in the fund industry. It succeeded in recovering all key operations within two hours, and the drill scored expected effects.

〇 2008
In March, it provided custody services for the first asset management scheme for specific customer of fund company in China.

In March, it rendered custody services for the first charity fund in China.

〇 2009
In February, it launched the custody services system for Anxin Account in the Bank.

In March, it provided custody services for the first special QDII product in China.

In July, it launched the custodian-management company data processing system.

In July, authorities for custody business were granted to five branches, Shenzhen, Beijing, Shanghai, Guangzhou and Zhejiang.

In August, it provided custody services for the first asset management schemes for multiple customers of fund company in China.

In December, it provided custody services for the first ESCROW product in China.

〇 2010
In July, it provided custody services for the first cultural industry fund in China-China Media Capital.

In August, it offered custody services for the first investable stock index fund in China-China Securities Index-China Security Southern Well-off Industry Index ETF Linked Fund.

〇 2011
In January, it provided custody services for the first gold fund in China-Lion Global Gold Securities Investment Fund.

In May, it provided custody services for the first bond index fund in China-China Southern-China Securities 50 Bond Index Fund.

In July, it launched the fifth-generation core custody processing system, the first to adopt standardized procedures in the domestic industry.

In July, it launched the asset custody performance assessment system (CIPS) independently designed and developed by ICBC with sole intellectual property rights.

〇 2012
In March, it became a pilot bank for QFLP (qualified foreign limited partner) custody in Beijing to provide custody services for a number of QFLP products. It is also the custodian for the first equity investment fund for QFLP in Beijing and even China, as well as the custodian for most QFLP products in Beijing.

In April, it launched the electronic fax program for custody business.

In May, it provided custody services for the first cross-market ETF in China-Huatai-PineBridge CSI 300 ETF.

In May, it provided custody services for the first wealth management bond fund in China-China Universal Wealth Management 30-day Bond Fund.

In June, ICBC (Asia) officially set up its Asset Custody Department.

In August, it provided custody services for the first seed fund in China-Tian Hong Bond Seed Fund.

In October, New York Branch started to offer custody services for QDII products in the US market.

In November, it provided custody services for the first classified collective scheme for securities companies in China-Guotai Junan Jundefeng No.1 Classified Bond Collective Asset Management Scheme.

In November, it launched a comprehensive custody system for capital from corporate customers throughout the Bank.

In December, it provided custody services for the first listed money market fund in China-China Universal Cash Express Money Market Fund.

In December, it provided custody services for the first immovable project invested with insurance funds in China.

〇 2013
In April, it provided custody services for the first securities investment asset management scheme for future company in China-Huatai Great Wall Futures “Yueyuezeng" No. 1 Valuation & Arbitrage Asset Management Scheme.

In April, ICBC (Macau) officially set up the Asset Custody Department.

In May, it provided custody services for the first corporate annuity & pension product in China-Changjiang Pension Insurance-State Grid Yingda Trust Pension Product.

In June, it filed an application for outsourcing fund business to the China Banking Regulatory Commission and China Securities Regulatory Commission.

In July, it provided custody services for the first gold ETF in China-Guotai Gold ETF.

In August, it became the first to launch bill custody services in China and concluded the first bill custody transaction.

In September, it officially signed an agreement on pilot program for outsourcing of accounting and valuation of special accounts.

In December, it signed an agreement on pilot program for outsourcing of TA performance and returns calculation.

V. Honors
In March 2004, ICBC was honored as the sole “Best Domestic Custodian (China)” in the first best custodian selection in the Chinese Mainland by the Hong Kong Asiamoney. ICBC also won a total of 48 best custodian awards granted by domestic and foreign authoritative financial media such as Global Custodian of the UK, The Asset of Hong Kong, Global Finance of the US, Chinese Securities Daily and Shanghai Securities News. As a domestic custodian reaping the most awards, ICBC has won constant recognition and widespread praise in the domestic and foreign financial fields with its quality services, enjoying increasing international influence and brand awareness.

As at the end of September 2015, ICBC's asset custody volume exceeded RMB9.1 trillion, leading peers for consecutive 17 years. In 2014, ICBC was honored with four "annual best custodian bank" awards granted by domestic and foreign authoritative financial media such as Global Custodian of the UK, The Asset of Hong Kong, Global Finance of the US, Financial Money of China due to its excellent performance and brand influence in domestic and overseas custody fields. In 2015, it won "Best Custodian Bank in China 2014" from Global Finance, The Banker and Shanghai Clearing House again.

1


The Chinese Banker

2015 Top Ten Financial Product Innovation Award

2


Shanghai Clearing House

2014 Best Custodian Bank of China

3


Global Finance

2014 Best Subcustodian Bank of China

4


Global Finance

2013 Best Subcustodian Bank of China

5


The Asset

2013 Best Custodian Bank of China

6


Global Custodian

2013 Best Custodian Bank of China

7


Financial Money

Best Custodian Bank of China

8


AsianInvestor

Best direct custody, China

9


The Chinese Banker

2012 Top Ten Financial Product Innovation Award

10


The Asset

2012 Best Custodian Bank of China

11


Global Finance

2012 Best Subcustodian Bank of China

12


Global Custodian

2012 Best Custodian Bank of China

13


INVESTOR JOURNAL

2012 Best Fund Custodian Bank of China

14


Financial Money

Best Custodian Bank of China

15


hexun.com

2012Best Asset Custodian Bank of China

16


National Business Daily

2012 Best Fund Custodian Bank of China

17


The Asset

2011 Best Custodian Bank of China

18


Global Custodian

2011 Best Custodian Bank of China

19


Global Finance

2011 Best Custodian Bank of China

20


Zero2IPO Group

China Venture Capital & Private Equity Annual Awards——VC/PE Fund Custodian Bank of the Year 2011

21


hexun.com

2011 Best Asset Custodian Bank of China

22


Financial Money

Zhou Yueqiu - 2011 Outstanding Achievement in Assets Custody

23


The Asset

2010 Best Custodian Bank of China

24


Global Custodian

2010 Best Custodian Bank of China

25


Global Finance

2010 Best Custodian Bank of China

26


Global Custodian

2009 Best Asset Custodian Bank of China

27


The Asset

2009 Best Asset Custodian Bank of China

28


The Asset

Zhou Yueqiu - 2009 Custodian Banker of China

29


Global Finance

2009 Best Asset Custodian Bank of China

30


The Asset

2008 Best Custodian Bank of China

31


Global Custodian

2008 Best Custodian Bank of China

32


Global Finance

2008 Best Custodian Bank of China

33


Securities Times

2008 Best Fund Custodian Bank of China

34


Almanac of China’s Securities Investment Funds

2008 Best Asset Custodian Bank of China

35


The Asset

2007 Best Custodian Bank of China

36


Global Custodian

2007 Best Custodian Bank of China

37


Global Finance

2007 Best Custodian Bank of China

38


Securities Times

2007 Best Custodian Bank (Fund) of China

39


Digital Times

2007 Financial Honor Roll——Best Custodian Bank of China

40


Shanghai Securities News

2007 “Golden Fund Award”——Award for 10 Years’ Outstanding Contribution

41


Securities Association of China

The “Project of Centralized Custody of Securities Investment Fund Accounts” won 2007 Best Innovation Award of Securities and Futures S&T Award

42


Global Finance

2006 Best Custodian Bank of China

43


The Asset

2006 Best Custodian Bank of China

44


Global Custodian

2006 Best Custodian Bank of China

45


The Asset

2005 Best Custodian Bank of China

46


Global Custodian

2005 Best Custodian Bank of China

47


Global Custodian

2004 Best Custodian Bank of China

48


Asia Money

2003 Best Custodian Bank of China


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