Deutsche Bank deploys DLT for custodial services
Following a successful pilot, Deutsche Bank Securities Services is set to start using distributed ledger technology (DLT) in custodial services.
The bank has been piloting a DLT-based system designed to address the transparency requirements within many custodial services, such as around the tax processing of asset holdings at an ultimate beneficial owner level.
Currently, says Deutsche, this level of information is not generally disclosed to, or captured by, subcustodians, with data provided in spreadsheets as and when needed and across multiple levels of disclosure. This leads to the manual collation of data and reconciliation challenges for the counterparts in the value chain.
Using DLT, the bank can share the same information to authorised counterparts, removing duplication and, at the same time, permit access to the beneficiary details to the relevant party only.
The first proper implementation of the system will help reform the shareholder information disclosure in Europe for global and sub-custodians, as set out in the Shareholder Rights Directive II, followed by tax processing automation and further product build-out.
“We are very excited about the opportunities that this solution, and the underlying technology, can bring for our future service model. We continue to remain focused on delivering products that increase efficiencies in the value chain, providing relevant and tangible benefits for our clients,”
says Jeslyn Tan, global head, product management, Securities Services.