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CHAPTER FOUR | MITIGATING RISK, SEIZING OPPORTUNITY
In 1995, DTC assumed custody responsiblities for Participants Trust Company (PTC). That same year, DTC would share its downtown Manhattan offices on Water Street with NSCC and PTC. Pictured from left to right are Karen Lind of DTC, Leopold
Rassnick of PTC, Karen Saperstein of NSCC and Ronald Garguilo of DTC.
The Board spent a lot of time on it, because this was clearly a Board issue. We wound up paying each of them a substantial amount of money, typically in the tens of millions of dollars. We got their business, which didn’t amortize the outlay we had, but politically it was the right thing to do for the industry and everybody came away happy. DTC was expanding beyond its typical base. In 1997, DTC and National Securities Clearing Corporation (NSCC) formed International Depository and Clearing, a joint venture in which each company held a 50 percent stake. DTC later renamed its offices in London, England, to reflect its part in the venture. The following year, DTC acquired Participants Trust Company (PTC), a depository for mortgage-backed securities. DTC and PTC had been working together since 1995, when DTC began processing and safe-keeping PTC’s Government National Mortgage Association securities in its vault. But the biggest consolidation would come when DTC and NSCC opted to merge in 1999. There had been attempts before, “and they’d all sputtered and failed,” said Jill Considine, who was named chairman and CEO in 1999. The merger made sense, particularly to participants who were “frustrated that you had two organizations that had duplicative human resources, finance departments and attempts to go global,” Considine said. The timing finally came together when NSCC and DTC had vacancies at the top at the same time. “That would take care of an issue of who was going to be running the combined companies, because of personalities and personnel issues,” Considine said. “I was the new kid on the block, so I didn’t have any history of tensions that might have existed at the time.”
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