Magazine article American Banker

Chase Enhances Global Custody, Adding Proxy Distribution

Magazine article American Banker

Chase Enhances Global Custody, Adding Proxy Distribution

Article excerpt

Chase Manhattan Corp. said it has begun using its sprawling electronic network to distribute foreign proxy notices to global custody clients.

The Chase system also collects proxy votes, verifies the number of voting shares, and sends reminders if votes are not received.

Chase gets the proxy information in a local office, translates the notice into English, then sends it to a central office in Bournemouth, England. From there the data are sent out again to custody customers.

Chase had already been using its electronic network to distribute information such as foreign exchange rates and market activities to its clients.

The proxy service is expected to increase fee income and improve service.

Chase said that while there has been little demand for such a service in the past, institutional investors are growing more involved in the companies they invest in, often waging proxy battles. The Chase service allows investors to get their votes in far more quickly than if they relied on the mail or fax machine.

The Chase service comes at a time when the incidence of proxy contests overseas is increasing. The U.S. Department of Labor mandates that pension fund shareholders vote their proxies whenever possible.

Even institutions such as mutual funds and insurance companies, which are not required to vote, are more interested in doing so, Chase officials said.

"It used to be people voted with their feet - by selling the stock," said Laila Mehdi, product manager for global proxy service and second vice president at Chase. …

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