In any discussion on T+1, the “600-pound gorilla in the corner”, as Andrew Douglas put it, is digitalisation. Moderating the session titled “T+1 and beyond: building the future of global markets” at Sibos 2025, Douglas, chair of the UK Accelerated Settlement Taskforce put up a poll and the audience spoke: 61 per cent predicted that the digitalisation of capital markets will happen in five to 10 years.
“Is there space for custodians in the future?” Douglas then asked. Camille Papillard, head of Financial Intermediaries and Corporates Client Line EMEA, Securities Services BNP Paribas, believes that there will be. “But the role will evolve,” she adds, predicting that the change in the custodian’s role will revolve around two main themes: artificial intelligence (AI) and asset tokenisation.
AI “might make some jobs redundant, but it’s already creating a number of jobs” – especially in compliance. As for asset tokenisation, “the primary role of a custodian is to bring safety and security. You’ll always need someone to connect you in a safe way to everything we do on chain”. Papillard concludes, “With increasing complexity and fragmentation, I think the role of a custodian is even more important.”
Fundamentally the same
Jane Masen, head of Custody at Securities Services HSBC agreed. “When the ledgers went away, the jobs didn’t go away,” she points out. “There was more technology. As you build more technology and you have more innovation, you have more opportunities to offer your client base more of what they want. It really is just a cycle.”
Masen recounted that in AI experiements that saw a reduction in manual effort, “there are other jobs that people go and do”. “Our clients want to speak to people. They want to engage with people… It’s our job sometimes to explain things to them that maybe the AI can’t explain,” she says.
“I think the digital world will continue in parallel for a while. I don’t think we’re going to come away from traditional custody for many years. We have another job to do, a different job to do, in the digital assets world. It doesn’t quite look the same, but actually it’s fundamentally what we’ve been doing for decades. Settling trades, asset servicing, et cetera.”
Timeless functions
Gareth Jones, head of Credit and Liquidity Services at Euroclear assured the audience that CSDs are not going anywhere. “Some things are timeless about financial markets… there are things that financial markets need in order to work effectively, in coordinated ways, safely and securely, with integrity and resilience. So financial market infrastructures – I’m confident that in 10 years’ time, they will have adapted, but they will be needed by new markets just as much as they are needed today, just as much as they were needed in the past.”
Sibos 2025 plays out in Frankfurt from 29 September to 2 October, with about 12,000 registered delegates. We are there, overview our coverage here.
