ANZ selling. NAB buying.

ANZ will sell its custody business to JP Morgan, the newsletter Investment & Technology reported. ANZ put the business up for sale in the wake of the Opes Prime affair of early 2008 and which led to a series of internal and external reviews on business practices.

The Australian Securities and Investments Commission ordered an external review of the custody business in March this year. ANZ was obliged to enter into an enforceable undertaking. ASIC contended that ANZ operated an unregistered investment scheme for about two years before Opes Prime failed, though ANZ conceded this point only in relation to the final few months of trading of its customer.

JP Morgan is one of the handful of banks worldwide that are steadily buying up local custody businesses. "Custody" refers to record keeping and reporting, usually on behalf of fund managers, over their ownership of securities.

Banks can make a tidy margin on handling cash transfers, foreign exchange and other transactions, as long as they are also efficient in meeting the reporting requirements of their customers.

National Australia Bank, meanwhile, said it will buy Calibre Asset Management in Hong Kong. Despite its name Calibre appears to be a financial planning firm.

Dow Jones reported on NAB's proposal to buy Calibre overnight. Dow reported that purchase price is in the low millions.