Over the course of more than a century, U.S. Bank has built an exceptional corporate trust business. The firm’s strategic acquisitions and dedicated investment in people and technology have made it the partner of choice across the securitization market. Standing head and shoulders above its competitors, the bank was a clear winner in both CLO Trustee of the Year and Securitization Trustee of the Year categories.
The firm has grown steadily over the years, fuelled in part by a series of well-judged purchases. The most recent was in 2021, when U.S. Bank acquired MUFG Union Bank, which included corporate trust and custody business. Although this had only a modest impact on the bank’s thriving securitization product offerings, it was yet another demonstration of the commitment U.S. Bank has to growing its corporate trust franchise.
Unlike other providers, our platform can support the various services that fall under the global corporate trustee umbrella
The trustee business is a scale business. GlobalCapital has recognised U.S. Bank for its work in the securitization sector, but the firm’s activities span a wide range of asset classes. The bank provides a world-class package of corporate trust services across products ranging from mortgage and asset-backed securities and CLOs to municipal and corporate debt, as well as ancillary services such as escrow and institutional trust.
“Unlike other providers, our platform can support the various services that fall under the global corporate trustee umbrella,” says Jeff Kerr, executive vice president, co-head of global corporate trust and custody. “We can leverage the various operational aspects of our business to support clients across various products.”
One thing the bank prides itself on is dedication to customer experience – creating a service model focused on building and deepening relationships with its clients. “Just as deal structures can vary, so can the way that clients prefer to interact with their trustee,” says Kerr. “Our competitive advantage is that we work to serve our clients in the way that is best for them.”
The bank’s commitment to client experience and investment in technology mean its customers have access to cutting-edge data tools. One example is Pivot, an interface that provides data and reporting for customers. U.S. Bank has also used its insight and expertise to tailor these tools to specific needs. Pivot Portfolio Optimization allows its buyside customers to construct and design CLO portfolios that meet their specific credit investment criteria.
The bank always takes opportunities to develop new products that really add value for our clients
Joe Nardi, senior vice president, co-head of global corporate trust and custody, notes that as the market leader, U.S. Bank has access to a vast amount of data on underlying loans. “In the broadly syndicated loan space we touch 99% of the loans, so we’re allowing our buyside clients to tap into that huge pool of valuable data,” he says. “The bank always takes opportunities to develop new products that really add value for our clients. We have multiple initiatives for different markets where we’re making investments to advance our technology.”
At the same time, the bank is undertaking a significant upgrade of its settlement and cash movement system. State-of-the art infrastructure will continue to ensure the bank remains at the forefront of emerging technologies. But the firm also recognises that investment in personnel is even more important. “We recognise that we have an extraordinary team with a vast amount of experience who are the backbone of corporate trust,” says Kerr. “They're responsible for the leadership position that we're in and for the bright future that lies ahead.”
U.S. Bank has remained at the top of market league tables year after year. The firm has been the number one ranked trustee for ABS and MBS since 2015, and number one for CLOs since 2013. Competition in the trustee space is likely to increase, but so far in 2023 U.S. Bank has only expanded its leadership position. The firm’s ABS/MBS team increased their market share to 39% in the first quarter of 2023. The CLO team pushed its market share to over 50% in the same quarter.
“Corporate trust is a core business for U.S. Bank. We’re working on integrating more of our corporate trust products into our corporate and commercial banking relationships,” says Kerr. “We’ll continue to expand our ability to be a full service provider to our corporate, commercial and government clients.”