Since the Warsaw Stock Exchange (WSE) was re-established in 1991, Poland’s capital market experienced significant growth: market capitalization expanded from PLN 161 million to more than PLN 2.2 trillion. Alongside this development, custodians and local depository banks emerged as critical partners for global custodians, foreign investment banks, pension funds, and insurance companies.
Today, custodians do more than clearing and settling transactions. They are long-term partners expected to deliver high-quality services, anticipate client needs, and co-create tailored solutions. Rising regulatory requirements and higher operating costs are reshaping the industry, and shrinking margins, limited diversification, and lack of economies of scale forced many banks in CEE, including Poland, to exit custody in the past decade. For custodians, this creates an urgent need for reliable partners with long-term vision.
IT Investments – A Springboard or a Cost Burden
Sustaining custody services requires continuous investment in dedicated systems while leveraging the bank’s broader IT initiatives. To remain competitive, custodians must align investments with the bank’s overall strategy to maximize value. Sorbnet, Poland’s Real-Time Gross Settlement (RGTS) cash system, upgraded to ISO20022 standards, improving the cash leg of Poland’s settlement cycle, and tools, such as OCR, digitalized process flow for documentation, advanced connectivity solutions for data, and machine learning for inquiries, enhance and streamline processes. Such initiatives can significantly improve overall efficiency and service quality and demonstrate how leveraging bank-wide projects can strengthen custody services without duplicating costs.
National Champions
Global clients often must decide whether to choose an international custodian offering regional coverage or a strong domestic bank acting as a national champion. While global players benefit from broad networks, their local presence is often limited. Local champions, like Bank Pekao, rely on their balance sheet, liquidity, and deep domestic economy commitment.
They finance top players across many industries and support strategic projects. Post-trade services to domestic financial institutions with insurers and fund managers provide critical mass for investments and resource allocation.
Successful offerings to domestic pension and mutual funds rely on accommodating bespoke requirements. Efficient and top quality international standard services for assets in foreign markets require a local champion to select optimal sub-custody services abroad, and growing those assets may be factored into mutually beneficial partnerships.
Combining active sub-custody network management on numerous markets, meeting requirements of domestic and foreign clients, and sustaining bespoke solutions as a differentiator are best practices that require smart solutions and agility to keep efficiency, but create tremendous opportunity. They can be used across client bases, shaping the offering from market intelligence and lobbying power, through connectivity, to stringent SLAs on service.
The unique positioning and value proposition of local champions make them reliable partners for long-term growth and viable alternatives to local affiliates of global players.
Bank Pekao’s Value Proposition
Bank Pekao’s history as a custodian dates to the re-establishment of the WSE in 1991. We have grown alongside Poland’s capital market and its expertise and dedication have been instrumental to its development. We succeeded in making the significant leap required to catch up with mature global markets.
Today, Bank Pekao, is Poland’s second largest universal bank and a leader in custody. The bank serves global custodians and international broker-dealers, including clearing for WSE’s remote members. It expanded as a local depository bank, supporting pension and investment funds and ongoing IT developments range from maintaining cyber-security resilience to fostering data-driven or DLT-based services for clients.
The bank’s diversified business model, experienced custody team, and balance sheet unmatched in strength and liquidity are competitive advantages no other Polish custodian can claim.
Bank Pekao is grateful for the trust of long-standing clients and is fully dedicated to supporting them for many years to come.
