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Natalie Westerbarkey By Beverly Chandler, Opalesque London:

In a recent round table discussion organized by Advent Software and moderated by Thomas Zdon of that company, a group of hedge fund practitioners discussed the impact of the AIFMD on the industry. In this part of their talks, the group were looking particularly at the likely effects on custodians and depositaries.

Present at the meeting were Natalie Westerbarkey, Citi (VP Securities and Fund Services, Capital Markets and Banking); Bill Scrimgeour, HSBC (Global Head of Regulatory & Industry Affairs, Institutional Fund Services); Joan Kehoe, Quintillion (Founder & CEO); Rhodri Mason, MAN Investments Ltd (Head of UCITS Management) and Tom Kirkpatrick, GlobeOp (Managing Director, Enterprise Risk Management).

Westerbarkey believes the impact on the depositories will be significant because the stricter liability rules and the reversal of the burden of proof will entirely change the business profile of custodian banks. "They will have to review the risk implications and factor this in to the way they do the costing and the fee structure so to reflect the increased liability" she said. "They will also have to do an entire review of their sub-custody network from a due diligence point of view in the light of the stricter regulatory requirements and whether they are compliant still with the new world. There is also a possibility to delegate some of those responsibilities, which is currently under discussion of the new Lev......................

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