Data utility — it’s a buzzword, which has cropped up sporadically in the data management arena and is now making a comeback, albeit in diverse flavors. The latest wave of incarnations: a reference data utility launched by IBM and GoldenSource, and a know-your-customer (KYC) data utility disclosed by global messaging network SWIFT. Their unveilings earlier this […]
New Swaps Clearing Rules Trigger Services Shakedown
Brave new ideas, especially when they are mandated by regulators, typically trigger a messy shakedown of systems and services — out with the old, in with the new with a lot of cost and waste lying by the roadside for others to benefit. Such is the case with the multi-faceted regulatory drive to squeeze potential systemic risk out […]
SEC Attacks Systemic Risk Through Big Clearing Agencies
More collateral, more risk-related metrics and possibly higher fees for participants. That’s what banks, broker-dealers and even their fund manager customers might face should the US Securities and Exchange Commission’s new oversight rules for six large systemically important market infrastructures be implemented. Four years after the US adopted the Dodd-Frank Wall Street Reform Act, the SEC has finally come up […]
Recordkeepers Seek New Rules for Unclaimed Securities Accounts
With billions of dollars in unclaimed US securities accounts at stake, stock transfer agents are now lobbying for changes — and some consistency — in outdated state rules. As if tracking down the holders of unclaimed securities accounts weren’t hard enough for shareholder record-keepers, they must also deal with a multitude of conflicting and often […]
Fund Managers: Automating Risk Out of Derivatives Matching
The financial risk following discrepancies — or breaks — in matching trade details for derivative transactions can be serious business. Fund managers can easily encounter over a thousand trade breaks annually.When the process goes bad, it can go very bad and a widely anticipated growth in trading volume of exchange-traded derivatives (ETDs), makes an argument for greater automation compelling. While much of […]
Fund Managers: Outsourcing Trade Operations Not For Faint-Hearted
It’s become commonplace for fund managers to outsource middle and back-office operations. After all, who wants to staff and oversee the labor-intensive work that comes after trade execution, especially if it can be contracted out to specialists? It’s commonly understood that this type of outsourcing can reduce operating costs, address regulatory compliance requirements, and most important, […]
Validating NAVs: An Ounce of Prevention Saves a Lot of Grief
Net asset value, or NAV for short: it’s a basic calculation which hundreds of mutual and other investment fund managers have to make each day to allow investors to know just how much they will pay to buy and sell shares or units. While the timetable for when the figure must be struck might differ, […]
Private Equity Market: Can New Data Standards Win?
Adoption of new standards, particularly when its voluntary and not driven by regulation, can take a long while to get from “nice idea” to a baseline necessity for doing business. Ask global network SWIFT which helped create ISO message types for communication information on payments, foreign exchange transactions and finally post-trade instructions for banks and […]
ISO 20022 for Corporate Actions: A for Effort; C for Completion in US? (Update)
Where SWIFT goes, Depository Trust & Clearing Corp. follows. Not a phrase heard very often, if ever. However, when it comes to moving the US financial industry to ISO 20022 messaging for corporate actions, DTCC appears to have relaxed some of its demands. Nearly a decade ago, SWIFT pressed the financial community hard to convert from […]
UCITS V: Just When Are Depositaries Liable, or Not?
When operations executives, their relationship management colleagues, not to mention their compliance directors can’t agree on how to talk about a topic, it qualifies as organizational confusion. When it’s industry-wide, it’s a bona fide hot potato. That is the situation today as custodian banks in Europe, acting as depositaries for traditional investment funds, attempt to make sense of […]