U.S. Bank’s David Kubilus tells Funds Europe about the importance of offering an entrepreneurial customer experience.
The fund servicing market is increasingly crowded in Europe, with numerous vendors jostling to support asset managers that are targeting the growing investor market across the continent. David Kubilus, chief commercial officer at U.S. Bank explains to Funds Europe how the bank is using its size, and a cohesive client focus, to stay competitive.
Why is U.S. Bank locating and/or focusing on servicing clients from jurisdictions when many competitors have relocated their operations into different, lower-cost locations?
David Kubilus (DK) – From a U.S. Bank philosophy, this starts with the core franchise in the US and not offshoring the fund servicing business. All the US business is done in the US. Likewise, we follow a similar philosophy in Europe, where all business is serviced from Ireland, Luxembourg or the U.S. for our American clients. This builds a more cohesive strategy to execute against clients’ demands. If the fund administration team sits together, it should be able to answer any questions about administration, reporting, and so on. All teams sitting together on the same floor can create a nice dynamic around client service.
Why is it important to establish a cohesive client focus?
DK – We put a huge emphasis on people – both our clients and our employees. We do not want to position ourselves as the lowest-cost provider. We don’t necessarily want to be the biggest. But our ambition is to be the best. The market demands that, with firms willing to pay to get slightly better and bespoke client service for themselves and their investors. This emphasis on working in an agile and productive way also helps us attract the best talent – people who want the benefits of working at a large bank but within an entrepreneurial culture. That helps us attract good talent and, of course, that benefits our clients.
How does U.S. Bank stay competitive?
DK – First, let’s look at the market. There are very large global custodians that want to build on their scale and have a need to functionalise because they cannot possibly hire in all their jurisdictions. So, they use lower-cost locations; a philosophy that has worked for them and helped them record strong growth. At the other end of the market, there are smaller, privately held firms, which often don’t have full banking capabilities but tend to do more in-jurisdiction. We believe there is a mid-market to be serviced – the medium-sized asset managers that want a white-glove service from a bank with a balance sheet of a comforting size and are willing to pay a slight premium for that service.
What makes U.S. Bank enjoyable to work with?
DK – Using Luxembourg as an example, when it opened up in 2020, it had demand from very large US asset managers that were not getting the service levels they wanted for their existing clients in Luxembourg. For several years, they had been asking U.S. Bank to open a service centre in Luxembourg as it is their location of choice for raising funds in Europe. They wanted what sets U.S. Bank aside – the slightly bespoke level of reporting, the individualised customer experience, etc. That journey tells me why people like to work with U.S. Bank.
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