Winning with customers: Achieving differentiation in custody and asset servicing

Custodians and asset servicers continue to face headwinds from a tough macro environment and changing regulatory landscape, while being at the cusp of seismic technology changes. This includes artificial intelligence (AI), large language models (LLM) and digital ledger technology (DLT) that are delivering ground-breaking insights from vast data sources and enabling digitisation of assets that can redefine value chains. The securities services industry is constantly challenged to get the right balance between providing robust and efficient core services and innovative solutions for the future. So, amid the deluge, where should these institutions focus attention to service evolving client needs and sharpen their competitive differentiation? Should companies prioritise new value creation in core services by continuing to focus on data quality, efficiency, risk reduction and resilience initiatives using latest technologies such as AI and machine learning (ML)? Or should they focus more on augmenting the client experience with newer datadriven services and insights? Is a data-sharing and collaboration-driven platform and ecosystembased approach going to drive the future? This paper touches on some of the considerations and strategies that custodians are focusing on today to achieve client-oriented differentiation in custody and asset servicing.