'BoNYM'

Since the announcement of the Bank of New York and Mellon Merger to create a banking giant with approximately $17 trillion in assets under custody, there have been a lot of murmurings in the marketplace as to the strategic value of the deal for customers.

The merger between the two banks has resulted in it earning the moniker, 'BoNYM' in reference to the German band of the 70s, Boney M. I first heard that joke at lunch with another leading global custodian not long after the BoNYM announcement was made. It has since spiralled. It makes you wonder whether the branding gurus had a hand in the merger - what better way to capture the market's attention than naming yourself after a band that manufactured "bubble gum" infectious pop music.

Some observers suggest that whilst there are cost synergies to be realised from the merger, all is not "Daddy Cool." According to Richard Hogsflesh, managing director of R&M Surveys, which compiles an annual ranking of the top 10 global custodians, big does not necessarily mean better when it comes to customer quality.

In the December/January issue of financial-i magazine,he says that the trillion dollar tie up may be a cause for concern for existing customers of both banks as the deal appears to be more "shareholder-driven" than "customer-driven".

Another custodian I was speaking to the other day said whilst he understood the cost synergies both banks would derive from the merger, particularly in the competitive US custody market, he did not see how the merger would benefit the bank's international business.

It appears that the jury is still out on what 'BoNYM' really means for the global custody business, if anything?