The Bank of New York Mellon Corporation
) has launched a new Issuer Central Securities Depository (CSD)
unit in Europe after receiving the regulatory approval. The CSD
unit is aimed at providing the market participants with better
BNY Mellon's CSD unit, incorporated as a non-banking subsidiary,
will be headquartered in Belgium and regulated by the National
Bank of Belgium. The unit will provide issuer, settlement and
safekeeping services for all the market participants of Europe as
well as the worldwide markets. Currently, the company does offer
such services to its European clientele; however, on an
The establishment of the CSD unit will assist the company in
consolidating its operations in the European region. The move
follows BNY Mellon's launch of clearing operations for the
customers in Ireland almost a year and a half ago. The unit will
be spearheaded by a veteran BNY Mellon executive - Chris
The reason behind the launch of the CSD unit is the changing
regulatory landscape, which aims at making the securities market
more secure as well as efficient. For BNY Mellon - a bank holding
company and one of the world's leading financial institutions -
this is an excellent opportunity to enhance investment services.
By establishing the separate CSD unit, in response to the
regulatory changes (mainly centered on issuance and settlement
services), BNY Mellon expects to offer a plethora of integrated
services that would allow market participants to accommodate the
new requirements mandated by the European Market Infrastructure
Regulation (EMIR) and various other regulatory authorities.
Moreover, this unit will connect the European CSD market with the
rest of the world and facilitate easy transferability across the
We believe that the CSD wing will be beneficial to both BNY
Mellon and the market participants. For the company, it would
bring an opportunity to enhance its operations and boost the
top-line growth, whereas for the latter, this would mean smoother
trading and reduced risks.
Currently, BNY Mellon retains its Zacks #3 Rank, which translates
to a short-term Hold rating. However, other stocks in the same
AllianceBernstein Holding L.P.
Heartland Financial USA Inc.
) carry a Zacks #1 Rank (Strong Buy).
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