Absence of appropriate regulation base makes the majority of issued securities ineligible for new organisations. In the end of 1994 no settlements were done through Moscow CSO and its capitalisation is still under USD 1 million. Management of Moscow CSO is heavily relying on government support and participation of major Russian brokers in its policies and strategy development is only formal. Private initiatives in the infrastructure field were started in 1991-92 by a number of different companies. Therefore biggest Russian brokers only to the very limited extent participate in this initiatives, as they can not use them while dealing with foreign clients.
Russian banks have no interest in the custodian business yet.
They are mostly looking to the more profitable operations and only turn to the equity market while building their own finance-industry groups by purchasing control stakes in privatised enterprises. Operations of this type don't help to establish their custodian and settlement agent reputation. However possible conflict of interests prevents growth in this business. The need for the reliable custody services resulted in the appearance of foreign financial institutions in this area. At the end of 1994 custody services in Russia are offered by CS First Boston and ING Bank.