Trying to gain a detailed understanding of a service provider before engagement is a multi-layered process — and a critical one.

When conducting due diligence reviews, our primary focus is to help you distinguish well managed service providers, such as custodians, from those that potentially expose you to increased and unnecessary risks and costs. We can help you assess these providers and support you with risk mitigation.

Appointing a custodian means entering into one of the most important relationships you will establish. Your custodian is ultimately responsible for the safety of your assets, accurate processing and managing your investment data. This includes all the administrative functions underpinning the day-to-day operations of your investments.

Custodian fee review

The potential risk: Materially overpaying for custody services based on a dated pricing schedule.

Fee benchmarks help clients understand whether their custody fees are competitive compared to current offerings in the marketplace. Mercer has the expertise to interpret the nuances of fee schedules to create comparisons that a simple bidding process could overlook.

How clients could benefit from custodian fee benchmarking

  • Clients can determine if the current fees are in line with the level of service being offered
  • Benchmarking can streamline the fiduciary due diligence on an existing service provider

Our process

Mercer Sentinel can help develop an accurate representation of your existing investment structure and transactions and apply them consistently across custody fee rates of comparator custodian banks to produce an annualized custody fee comparison.
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Custodian service review and search

The potential risk: Suffering material staff inefficiency and excess cost by failing to examine existing custody services and fee

How clients could benefit from custodian fee and service reviews

  • Enables asset owners to complete critical fiduciary due diligence for committees, boards and auditors
  • Asset transition consulting, transition coordination and transition manager search/evaluation
  • Foreign exchange and equity transaction cost analysis (TCA)

Projects completed over the last three years have improved service levels and identified potential fee savings.

Fee savings cannot be guaranteed

Contact our due diligence specialists