State Street Securities may soon extend its powerful hold on the U.S. securities custody business into France, Germany and the United Kingdom if its talks with the asset management division Axa, the giant French insurer, lead to a deal, according to Reuters. Axa Investment Managers, which oversees $359 billion in assets in leading European markets, is contemplating a move to outsource its custody business to Boston-based State Street. Outsourcing custody services is a common play among the larger asset managers seeking competitive prices from vendors leveraging large scales of economy to offer discounts. Potential savings from deal would allow Axa to invest more resources in its core competencies, according to Nicolas Moreau, head of Axa's money management unit. State Street, the dominant service provider in the U.S. market, custodies trillions of dollars, including the holdings of most mutual funds listed in the pages of newspaper stock tables.
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