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What are Custody Services?

Custody Services are banking services that are directly linked to and revolve around the safekeeping of physical documents of title (or their electronic equivalent) for Capital and Money Market instruments such as Fixed Deposits, Treasury Bills, Treasury Bonds, Corporate Bonds, Commercial Papers, listed and unlisted Equities, Unit Trust Funds, etc.

Why appoint a Custodian?

• Having a Custodian Bank provides checks and balances between an investor’s service providers (Stock-Brokers and Investment Managers) and creates transparency in transactions.
• Custodians don’t decide what is bought or sold; they simply hold the assets securely on behalf of their clients and undertake all activities pertaining to those assets. The safekeeping function reduces risk for clients (asset owners).
• The appointment of a Custodian ensures compliance with the regulations and international best practice for regulated entities such as Retirement Benefits Schemes and Collective Investment Schemes.

What does a Custodian do?

• The Custodian holds the documents of title for the customer’s investments in safe custody.
• The Custodian opens a bank account for the Customer, and provides banking services in support of investment transaction processing for the Customer.
• The Custodian implements the Customer’s instructions to purchase or sell of investments, locally and offshore.
• A Custodian provides reports to account for the Customer’s investment portfolio on a daily, monthly or quarterly basis.
• The Custodian does not design the Customer’s investment portfolio or offer investment advisory services.

Benefits

• Process automation

  Minimal human intervention required hence reduced errors.

• Specialized service

  Skilled and experienced team of industry specialists.

• Gain market insights

  Practical knowledge of the counter-parties in the local and global markets.

• Flexible account size

  No ceiling on the minimum size of account to be accepted.

Services Offered

To Individual Customers:

• Opening & amending of Central Depository System Accounts for KCB Account Holders.
• Purchase or sale of ALL listed equities.
• Immobilization of shares.
• Transfer of shares between Central Depository Agent (CDAs) e.g. between other custodians and/or registered brokers, placing and uplifting of lien for CDS accounts held at KCB Custody only.
• Private transfers between family members for KCB CDS account holders.

Service Rates and Fees

• Fees are calculated based on the market value of the assets held.
• No termination penalties.

Target Customers

Custody Services target customers include:

• Pension Schemes or Provident Funds.
• Gratuity Funds.
• Income Drawdown Funds.
• Post- Retirement Medical Funds.
• Unit Trust Funds.
• Individual Pension Plans.
• Umbrella Pension Plans.
• Corporates and high net-worth individuals.
• Endowment Funds.
• Trust Funds.
• Investment clubs and charitable institutions who would like to invest in securities.

Contact details

Investor Services,
KCB Towers, 7th Floor, Kenya Road, Upper Hill
P.O. Box 30664-00100 Nairobi, Kenya
Telephone: +254 20 3270-000/0711-012-000
Mobile: +254 729 858303
Email: custody@kcbgroup.com