About Custody

What Is the Custody Service?

DTC’s Custody Service enables participants to outsource the safekeeping and processing of physical securities that are not traditionally eligible for the regular depository services.

You can outsource all or part of your physical securities inventory for safekeeping.

When Regular Custody Services are used in conjunction with DTC's Branch Deposit Service (BDS), Restricted Deposit Service (RDS), and New York Window (NYW) Service, Custody participants are able to retain control of their securities without having to handle and secure them.

The Custody Service allows you to deposit securities not traditionally eligible for DTC, including securities such as customer-registered custodial assets, restricted shares, and certain DTC-ineligible securities such as certificated money market instruments (MMIs), private placements, and limited partnerships.

Eligible Assets

DTC intends to make all appropriate securities eligible for its Custody Service. DTC reserves the right, in its sole discretion to refuse to accept a security or other asset for its Custody Service.
Note- DTC compares certificate information with the deposit instruction transmitted by the depositing Participant in the “deposit expectancy file”.
Anything that can be securitized is eligible for custody including, but not limited to:

Stocks (negotiable, non-negotiable and restricted)
Bonds
Open-ended mutual funds, short-term money market instruments, foreign securities, interest only, limited partnerships, promissory notes, private placements, customer-registered custodial assets.
Gold/Silver certificates
Note: DTC Custody will hold certain “non-standard” type assets fully disclosed for safekeeping only. These assets include, but are not limited to, Option Agreements and Warrant to Purchase. DTC does not accept any liability should such assets be lost, stolen or destroyed. Depositing Participants assume full liability as well as responsibility for replacement of lost, stolen or destroyed fully disclosed “non-standard” assets.

Issues Not Eligible for the Custody Service

Financial items/documents that are not eligible for the Custody service include:

Currency

Wills, deeds, insurance

Policies, Mortgage papers

Terminal output of stock

Record positions

Tickets/Vouchers for airline

Permanent loan certificates

IRA Statements

Annuities/ Tax Returns

Interest only

Bills of sale

Bank account applications

Liquidity Letters of Credit

Legal correspondence on clients assets

Contracts of prevailing wage certificates

Legal correspondence on clients assets

Assignment of real estate

Service Components

Safekeeping

DTC’s Regular Custody Services free you from the cumbersome physical handling of those securities that are not traditionally eligible for DTC processing.

Processing withdrawals from inventory, which can include mailing to your customers or branches
Mailing of certificates as instructed
Production of customized letters
Systemic account number changes
Coupon clipping and shell presentation
Trailing document deposit
Customer request for audits

Transfers

DTC’s Custody Service allows you to submit transfer instructions requesting re-registration into firm or customer name. It also allows for breakdown requests.

Restricted Transfers

Restricted deposits and their transfer instructions are hand delivered or sent by FedEx Priority Overnight service to the transfer agent.

Custody Reorganization

The Custody Reorganization Service allows for presentations on corporate events not eligible for regular DTC services and/or DTC eligible corporate events in restricted shares.

Assistance with research into reorganization and redemption activities
Follow-up until all proceeds have been collected
Allocation of both cash and stock proceeds
Option of designated custody boxes for reorg sweeps

Branch Deposit Service (BDS)

The Branch Deposit Service (BDS) allows you to have your customer deposits sent directly to DTC from their branches and/or correspondents. The BDS service performs a full examination of these securities prior to crediting into your free account.

Less workspace and vault space required
Reduce deposit cycle time
Mitigate risk

New York Window/Physical Settlement

The New York Window (NYW) allows customers to effect both over-the-window and NSCC & ESS transactions. Customers can effect deliveries using inventory from their custody vault.