Key Takeaways
- • ATP, Denmark's statutory supplementary pension fund, uses US banking giant BNY as its custodian bank, the institution that holds the fund's securities.
- • Actuary Jørgen Svendsen of AFPR argues that, given ATP's political mandate over Danes' collective savings, it should have switched to a European custodian bank.
- • Svendsen's core concern is that in a crisis the custodian may not be allowed to act on ATP's instructions, rather than that assets would be taken.
- • ATP responds that European custodians also rely on local sub-custodians and central securities depositories, so switching would not remove underlying geopolitical and operational dependencies.
- • Pædagogernes Pension (PBU) is moving from J.P. Morgan to France's BNP Paribas to reduce its operational dependence on the US.
Summary
ATP, Denmark's statutory supplementary pension fund, uses the US banking giant BNY as its custodian bank, according to AMWatch. The arrangement is drawing criticism even as the fund's peers reassess their own reliance on US custodians. Inside Business reports that several Danish pension companies have begun questioning their use of US custodian banks amid unease over the strained relationship between US President Donald Trump and the EU and Denmark. AMWatch describes the debate as part of broader concern in Europe about dependence on US financial infrastructure.
Actuary Jørgen Svendsen of AFPR told Inside Business that, given ATP's political mandate over Danes' collective savings, the fund should have switched to a European custodian bank. "The risk isn't that someone takes the assets. It's that, in a crisis, the custodian bank may not be allowed to act on ATP's instructions," he said.
ATP has responded that European custodian banks also use local sub-custodians and central securities depositories, so switching custodians would not eliminate the underlying geopolitical and operational dependencies. The fund's position, as reported by AMWatch, is that the risk cannot be removed simply by changing the custodian's domicile.
By contrast, Pædagogernes Pension (PBU), the pension fund for Danish early childhood educators, is moving in the opposite direction. It is shifting its custody relationship from J.P. Morgan to France's BNP Paribas to reduce its operational dependence on the US.
Actuary Jørgen Svendsen of AFPR told Inside Business that, given ATP's political mandate over Danes' collective savings, the fund should have switched to a European custodian bank. "The risk isn't that someone takes the assets. It's that, in a crisis, the custodian bank may not be allowed to act on ATP's instructions," he said.
ATP has responded that European custodian banks also use local sub-custodians and central securities depositories, so switching custodians would not eliminate the underlying geopolitical and operational dependencies. The fund's position, as reported by AMWatch, is that the risk cannot be removed simply by changing the custodian's domicile.
By contrast, Pædagogernes Pension (PBU), the pension fund for Danish early childhood educators, is moving in the opposite direction. It is shifting its custody relationship from J.P. Morgan to France's BNP Paribas to reduce its operational dependence on the US.
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