U.S. Bank has excelled in the corporate trust business for years, building a market-leading position through strategic acquisition, dedication and client focus. The 2021 surge in issuance across CLOs and securitization more broadly challenged capacity across the market, but U.S. Bank stepped up with a dynamic hiring strategy and significant investment in technology. This helped distinguish the firm as a clear winner of both CLO Trustee and Securitization Trustee of the Year.
“The market recognises our dedication to this industry,” says Jeff Kerr, executive vice president, global structured finance and document custody services. Consolidation across the space has seen many banks struggle to define their focus, but U.S. Bank has had a clear, unwavering commitment to corporate trust for decades, growing its operations through more than 25 strategic acquisitions over the last 28 years. “That commitment is something that’s understood and appreciated by all participants in this sector, and has been an anchor of strength for us,” says Kerr.
That commitment is something that’s understood and appreciated by all participants in this sector, and has been an anchor of strength for us
U.S. Bank has been ranked first for market share in CLO, ABS and MBS for the better part of a decade, standing out for its strong credit rating, service quality and exemplary risk management. Although the firm recognises growing market share as a benefit of its approach and a reflection of how well it serves its customers, market share is by no means the “ultimate goal”, says Joe Nardi, senior vice president, U.S. CLO business head. “People see that we put our clients first in our decision making, and this is what has allowed us to build long standing relationships that have led us to a consistent market leading position,” he says.
U.S. Bank has maintained a broad range of customers and collateral types and remains focused upon deepening those relationships. “Deepening existing verticals allows us to grow with our clients as their book of business and the market expands,” says Kerr. “Demand for these services has been high because of the issuance volume over the last couple of years, and we want the market to know we're open for business.”
In 2021, the CLO space saw unprecedented issuance as assets under management reached all-time highs. ABS and MBS volumes also jumped, challenging the whole securitization market to keep up with volumes. U.S. Bank responded to the surge in activity and increasing demand from clients with an aggressive hunt for talent. “We've made significant progress in increasing our staffing levels to meet clients' needs,” said Nardi.
Responsiveness and commitment to the client through the heightened issuance of 2021 was critical and the team really stepped up to meet that demand
Similarly, the bank’s focus on industry-leading technology and automated processes resulted in significant productivity gains. CLO’s are a perfect example, where automation technology allows the firm to process millions of loan notices and corresponding loan payments each year. “Our priority is always to stay ahead of the competition in providing a service that is efficient, accurate and timely,” says Kerr. “This means a concerted increase in resources and investment to support the business.”
U.S. Bank continues to drive for even greater improvements as the market adapts to new processes, but the one area it does not automate is client services. Here, the company pursues a dedicated consultative approach tailored to each customer's specific needs and demands. “That’s part of the core competency of the bank,” says Kerr. “We’re truly customer-focused and pride ourselves on knowing our clients very well and making sure they’re satisfied.”
A solid dialogue with clients is key, whatever the backdrop, but having the complete trust of customers has been particularly important for U.S. Bank as the market evolves, both in terms of overall volumes and how deals are structured. “That trust comes from having a proven history of execution, and it helps us be nimble and reactive in pivoting as clients take their book of business in new directions,” says Nardi. “Responsiveness and commitment to the client through the heightened issuance of 2021 was critical and the team really stepped up to meet that demand.”