Decision / Operating model
Changing the custody model
Who should control the assets, and where should they sit?
Custody decisions are structural. Who controls assets, and in which jurisdiction, can change both what is required and what the operating model has to prove.
The same commercial arrangement can sit in several custody configurations, each with a different regulatory delta.
Regulatory delta
What this decision tends to move
The delta is the difference between the institution's position today and its position if this decision were executed.
- Control
- Who has legal and practical control.
- Permissions
- What custody authority is required.
- Location
- Where assets sit, and what that implies.
- Controls
- What must be evidenced continuously.
- Judgement
- Where the position is genuinely unsettled.
Design space
Ways to reach the same commercial objective
Two configurations that achieve the same outcome frequently produce materially different regulatory deltas. Comparing them is how the decision is made.
Option 01
Self-custody by the institution
Maximum control, maximum requirement.
Option 02
Qualified third-party custodian
Shifts consequence to the dependency.
Option 03
Split custody by asset or customer type
Segments the consequence.
Before committing
What management should establish first
- Which configuration the commercial model actually needs
- What each configuration requires the institution to demonstrate
- How a later migration would be handled
Common questions
Questions this page answers
Why treat custody as a decision rather than a vendor choice?
Because the configuration, not the vendor, is what moves the regulatory position.
Related decisions