The Securities Exchange Board of India has granted in-principle approval to YES Bank to act as custodian of securities (CoS). The license will allow YES BANK to offer custodial services to financial market participants, including foreign institutional investors and foreign portfolio investors. The bank, which had earlier received the RBI’s approval to enter the CoS business, plans to establish CoS business within 12 months of approval. According to the bank, the size of the custodial business in India is steadily growing with increasing value of assets under custody as well as newer investor classes such as portfolio management services and alternative investment funds opting for custody services. Given the increasing customer base and ability to offer a host of transactional banking and financial market products, adding custodial services to the bank’s product suite has strong business potential which makes it an attractive business proposition, the bank said.
