“We meet at a moment when the custody industry is operating in one of the most complex environments it has ever faced,” said Paul Maley, Global Head of Trust and Securities Services at Deutsche Bank. Maley opened a recent London forum at The Savoy hotel to debate the future of custody, hosted by Global Custodian and sponsored by Deutsche Bank.

Addressing today’s backdrop of growing geopolitical fragmentation, accelerating digital asset adoption, rapid advances in artificial intelligence (AI) and data infrastructure, and growing questions over Europe’s long-term competitiveness, the discussion brought together senior representatives from Brown Brothers Harriman (BBH), Clearstream, JP Morgan and State Street Corporation to explore the forces reshaping custody.

“The central premise,” Maley continued, “is that complexity is not simply a source of pressure, it is also a source of opportunity. The institutions that can absorb this complexity, interpret it and act on it with confidence may well be the ones that decide what the decade ahead for securities services actually looks like.”

This article summarises four key themes from the discussion.

“Global custody was invented because investing internationally became too operationally complex for asset owners to manage themselves,” observed Phil Brown, Head of Global RM, Sales & Client Services at Clearstream, referencing the industry’s origins in the 1970s when institutions such as the Ford Foundation began investing overseas.

While the industry was built to solve complexity, panellists argued that the nature of that complexity is now changing rapidly. From the war in Ukraine and conflict in the Middle East to sanctions divergence, tariffs and broader geopolitical fragmentation, the operating environment for custodians is becoming materially more difficult.

“Geopolitical risk has been the biggest driver for complexity,” said Sinead McIntosh, Head of Revenue for Financial Institutions at BBH. “It’s changed from a policy consideration or an episodic process operation to really systemic across the board. And it’s becoming very hard for banks – and the industry more broadly – to leverage the cross-border interoperability that we rely on quite heavily.”

“Geopolitical risk has been the biggest driver for complexity”
Sinead McIntosh, Head of Revenue for Financial Institutions, Brown Brothers Harriman

Chris Rowland, Head of Custody, Digital and Fund Services at State Street argued that the industry may now be entering a structural transition away from several assumptions that shaped custody over recent decades.

“Everything we do is global – our operations, our technology, the way we deliver service to our clients. It’s very much a globalised model,” he said. “But what we are beginning to see is the breakup of some of that, and you’ve got to start to see local or regional responses to some of these global challenges.”

From left to right: Phil Brown (Clearstream); Sam Cauvain-Welsh (J.P. Morgan); Sinead McIntosh (BBH); Chris Rowland (State Street); and moderator Chris Lemmon (Global Custodian). Image: Global Custodian

The implication is that resilience can no longer be viewed purely through a global lens. As geopolitical fragmentation accelerates, firms may increasingly need to consider infrastructure sovereignty, regional operating models and localised resilience alongside their broader international platforms.

One positive is that the repeated market shocks over recent years have put strong foundations in place to assess and react to these changes. “We now have a much deeper understanding of our business end to end – where the dependencies sit, what can fail, and the volumes and values moving through every stage of the process,” explained Sam Cauvain-Welsh, Head of Core Product for Global Custody at JP Morgan.

In July 2025, the US passed the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, establishing a federal framework for stablecoins, including requirements around reserves, disclosures and regulatory oversight.¹ Alongside Europe’s Markets in Crypto-Assets Regulation (MiCA)², argued panellists, these developments are beginning to address one of the biggest historical barriers to digital finance: the availability of a trusted settlement asset on-chain.

During the panel discussions, Brown revealed that Clearstream expects to complete its first benchmark sovereign issuance on distributed ledger technology (DLT) infrastructure this year. The company launched its tokenised securities platform, D7 DLT, in November 2025.³

But while issuance may increasingly become digital-native, Brown argued the surrounding ecosystem remains fundamentally hybrid. “The challenge is, how do you deal with the security that’s natively digital when not every market counterparty is able or willing to interact with you in a natively digital way?” he asked. “It means we’re likely going to live with a single liquidity pool in dual settlement environments for some time yet.”

That need for interoperability was echoed by Rowland, who argued that digital asset servicing cannot exist in isolation from the broader custody operating model. “You have to be able to say my traditional fund accounting platform is integrated with my digital asset platform, my data platform is integrated with my digital asset platform, my reporting suite covers everything,” he explained.

On the issue of who runs this platform, the discussion turned to the question of shared infrastructure. McIntosh argued that the industry risks wasting investment by repeatedly rebuilding similar capabilities independently rather than collaborating where appropriate. “Not every institution needs to reinvent the wheel, particularly where infrastructure is no longer a true competitive differentiator,” she said.⁴

AI was another major theme throughout the discussion, particularly as firms assess how rapidly evolving AI capabilities could reshape operational models, software development and long-term infrastructure strategy across the custody industry.

“What AI can do today is completely different to six months ago,” reflected Cauvain-Welsh. “What we might be able to use AI for in 2030 or 2035 is kind of outside what we can even really comprehend at this time.”

That acceleration, he argued, is already changing how institutions think about software modernisation, technical debt and operational productivity – with potentially significant implications for firms that fail to modernise their underlying technology architecture.

“I firmly believe that firms which get AI right will have a significant accelerator, while those that get it wrong risk being left badly behind,” Brown added. “And if an institution’s infrastructure is still built around on-premise systems rather than cloud-native architecture, they will struggle to unlock the full benefits of these technologies.”

“I firmly believe that firms which get AI right will have a significant accelerator”
Phil Brown, Head of Global RM, Sales & Client Services at Clearstream

For those that have already laid the right foundations, Rowland suggested that AI may partially reverse the long-running buy-versus-build trend by allowing firms to modernise and rewrite applications internally far more rapidly.

“If you own the codebase and have those capabilities in house, you can now use these tools to rewrite platforms in a remarkably short period of time,” he said. “Over the next 12 to 18 months, we may see an explosion of new applications being developed rapidly using AI, potentially removing some of the longstanding technology challenges the industry has struggled with for years.”

At the same time, stressed panellists, firms rushing headfirst into AI adoption also risk getting it wrong, particularly as governance and client trust remain paramount.

“Clients are ultimately interested in governance,” argued McIntosh. “While it’s very easy to get overexcited about all the different things you could do, you’re not going to have a business for very long if you can’t demonstrate trust and control to your clients.”

The panel also explored Europe’s broader competitiveness, where debate has moved increasingly to the forefront of financial market discussions following Mario Draghi’s September 2024 landmark report on European competitiveness. The report warned that the European Union’s fragmented capital markets are limiting investment, innovation and scale, leaving the region increasingly exposed relative to the US and China.⁵

Those concerns have helped drive momentum behind the proposed Savings and Investments Union (SIU), which aims to address part of that challenge by mobilising household savings and improving the flow of investment into European businesses and infrastructure.⁶

While the intentions are clear, it may be a case of too little too late. “We are living in a world of fail fast – and I just don’t think Europe is moving fast enough to deal with what we’re seeing in front of us,” Rowland said, describing the SIU as the latest attempt to get a long-running European integration project off the ground.

Brown broadly agreed on the pace of policymaking but argued that the SIU debate is already beginning to influence behaviour across the private sector. He cited growing pressure around pension reform, retail participation and the mobilisation of long-term savings into equity markets rather than traditional fixed-income products.

This article is based on a forum discussion hosted by Global Custodian and sponsored by Deutsche Bank, titled ‘The future of custody roadmap’, which took place on 14 May 2026 at The Savoy Hotel, London. Participants included Phil Brown (Clearstream); Sam Cauvain-Welsh (JP Morgan); Sinead McIntosh (BBH); Chris Rowland (State Street); and Chris Lemmon (Global Custodian)

Sources

¹ See S.1582 - 119th Congress (2025-2026): GENIUS Act | Congress.gov | Library of Congress at congress.gov
² See Markets in Crypto-Assets Regulation (MiCA) at esma.europa.eu
³ See D7 DLT: Clearstream Launches Tokenized Securities Platform at clearstream.com
⁴ See Digital Money – a perspective on stablecoins, tokenised deposits, and CBDCs at flow.db.com
⁵ See The future of European competitiveness at commission.europa.eu
⁶ See Savings and investments union at finance.ec.europa.eu