JPMorgan Chase is reportedly planning to outsource its local custody business operations in Hong Kong and Taiwan. According to two sources familiar with the matter, Citigroup, HSBC, and Standard Chartered are considered potential partners for this plan. 

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NEW YORK, NEW YORK - MAY 26: The JPMorgan Chase logo is seen at their headquarters building on May 26, 2023 in New York City.

JPMorgan Chase to Pick a New Bank For Local Custodian Operations in Hong Kong, Taiwan

The sources told Reuters that the Wall Street bank, the world's third-largest global custodian, is in the process of selecting a new bank to take over the local custodian operations in Hong Kong and Taiwan. 

While the deal's financial details have not been disclosed, it is worth noting that JPMorgan Chase manages around $520 billion worth of client assets under custody (AUC) as a local custodian in Hong Kong and Taiwan.

Local custody business involves handling transactions and managing the book for clients accessing specific markets, while global custody focuses on managing cross-border investments and maintaining relationships with clients across a broader network.

JPMorgan intends to continue providing global custody services in Hong Kong and Taiwan. But for local custody services in those two markets, the Wall street bank targets completing the transition to another bank by the end of 2024, a third source told Reuters. 

READ ALSO: JPMorgan Chase Is Ready to Leave China if Ordered by US Government, Bank CEO Jamie Dimon Says 

JPMorgan Chase Also Offers Local Custodian Services in India 

Aside from Hong Kong and Taiwan in the Asia Pacific region, JPMorgan also offers local custodian services in India. But in recent years, the bank has strategically exited lower-margin local custodian business in other Asia Pacific markets, including Australia, due to declining custodian assets, which made it less lucrative.

It is worth noting that JPMorgan, Standard Chartered, Citigroup, and HSBC have yet to comment on this report. 

READ MORE: India Dethrones Hong Kong as the World's 7th Largest Stock Market