Answers about Bank Custodians
How are bank custodians regulated?
National bank custodians are regulated by the Office of the Comptroller of the Currency. Custody is a volume-driven, transaction-processing business, and much of the risk associated with it is operational in nature. For this reason, strong operational controls (separation of duties, dual control, and accounting controls) are essential to effectively manage transaction risk. The Comptrollers Handbook for Custody Services outlines various risk management systems expected of national bank custodians and in their selection of sub-custodians. These include operational controls, account acceptance and monitoring, management information systems, and board and management supervision.