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Establishment of a Custodian Company in Jordan: Feasibility Study Support



Business sector:

Financial institutions

Funding source:

SEMED cooperation funds account

Contract type:

Consultancy Services

Notice type:

Invitation for expressions of interest (CSU)

Issue date:

01 Apr 2016

Closing date:

26 May 2016   at  23:59   London

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Assignment Description: The availability of professional, well-managed custodian services is one of the building blocks of capital markets. A custodian service, which can be provided by a bank or a special independent company, typically holds customers' securities for safekeeping so as to minimize the risk of their theft or loss, and can also provide a range of services and products, further enhancing the capacity of the local market. This has been a weak aspect of the Jordanian market for some time.

For many years, Jordan’s securities market was served primarily by one foreign bank acting as a local custodian, namely HSBC Jordan. Although the Jordan Securities Commission had granted around 14 custody licenses to local commercial banks, most of these were not active as local banks shied away from offering custody services to international investors. This was mainly due to the fact that the local banks lacked custody expertise needed to attract sophisticated international institutional investors which are active in the Jordanian securities market. As a result, HSBC had a de facto monopoly in offering local custody services.

The reliance on HSBC was highlighted when in 2014 HSBC took a sudden and unexpected decision to exit Jordan (among other Arab countries) and decided to sell its local commercial banking operations to a local Jordanian bank. The suddenness of the exit decision took everyone by surprise, including global custodians who were using its local custody services in Jordan to service their international clients.

The four Jordanian banks have engaged a local consultant to prepare a feasibility study for the establishment of a Jordanian custody company to offer custody services in the Jordanian securities market as well as in some of the other securities markets in the Middle East and North Africa (“MENA”) region. Due to unexpected local developments the European Bank for Reconstruction and Development (the “EBRD” or the “Bank”) has now an opportunity to contribute to the development of such services by supporting the preparation of the feasibility study.

The EBRD now wishes to engage an individual international custody business expert (the “Consultant”) to review the feasibility study, define the business model, propose services and products and ensure that international best practices are applied (the “Assignment”).

The provided services will complement the work of the local consultant carrying out the feasibility study. The Bank will provide an international perspective and best practice in the field of custodian services. Depending on the outcome of the Study, the Bank might further support this important development via a possible investment into the newly established Custodian Company.

Status of Selection Process: Interested individual experts or firms interested in nominating an expert are hereby invited to submit expressions of interest.

Assignment Start Date and Duration: The Assignment is expected to start in June 2016 and has an estimated overall duration of 2 months.

Cost Estimate for the Assignment: EUR 20,000.00; exclusive of VAT.

The consultant must determine whether any VAT would be chargeable on the services and the basis for that determination, without taking into consideration the Bank's special status as an international financial institution (IFI), and state this in their response to this Invitation for Expressions of Interest. To the extent that a consultant incurs input VAT on goods and services purchased in connection with the provision of services (eg VAT on airline ticket) which is not otherwise recoverable by the consultant from the local tax authority, the gross cost to the consultant of such expenses shall be treated as a reimbursable expense.

Funding Source: It is anticipated that the contract will be financed through the EBRD's Southern and Eastern Mediterranean (SEMED) cooperation funds account.

Eligibility: There are no eligibility restrictions. However, consultant selection and contracting will be subject to availability of funding.

Consultant Profile: The Consultant will be an individual expert with:
Preferably 7 years’ experience at a custodian bank, with experience of operating a custodian service, the post-trade operations and international best practices;
Preferably 3 years’ experience working as a consultant on similar custodian bank assignments;
Excellent knowledge of international standards in developed markets related to the delivery of custodian services;
Experience in the design of business models and operations on custodian bank level;
Knowledge of the securities market in Jordan, the Levant or the Middle East would be an advantage;
Proficiency in written and spoken English language.

Submission Requirements: In order to determine the capability and experience of experts seeking to be selected, the information submitted should include the following:

1. Cover letter (max. 2 pages) summarising why the expert believes they satisfy the requirements as defined in the Consultant Profile;

2. CV (not exceeding 4 pages) which should include full descriptions of responsibilities carried out, not just a job title, including information on contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided (if different from duration) , main activities, objectives.

3. Completed Consultant Declaration From and Contact Sheet, the template for which is available at:

Expressions of Interest should be submitted, in English, electronically through eSelection, and reach the Bank not later than the closing date. The complete expression of interest (including cover letter, CV, declaration and contact sheet etc.) shall be one file (pdf) to be uploaded to eSelection. The EBRD reserves the right to reject applications of experts submitting more than one file. Only if the permissible file size (4 MB) is exceeded, the Consultant may split the expression of interest into further files.

The EBRD's Contact Person:
Georgia Vasiliadis (Ms)
Principal Advisor, Technical Cooperation Team
European Bank for Reconstruction and Development
One Exchange Square
London EC2A 2JN
Tel: +44 207 338 7750
(Submission should be sent through eSelection and NOT to this e-mail address)

Important Notes:
1. The selection will normally be made from responses to this notification only. Consultants will not be asked to submit a proposal. The highest-ranked Consultant will be selected from a shortlist and be invited to negotiate the contract, subject to availability of funding.

2. Consulting firms (proposing individuals) and individuals may apply. Consulting Firms nominating an individual expert shall submit one complete individual application for each expert via eSelection. Single applications for a number of experts containing various CVs may result in rejection of such application and all concerned experts.

3. The evaluation criteria are as follows:
- Expert’s previous experience at a custodian bank, with the practical knowledge in the development and operation of a custodian service, including post-trade operations and international best practices (80%)
- Expert’s knowledge of international standards in developed markets related to the delivery of custodian services (20%)

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