ISIN — the 12-digit alphanumeric international securities identification code and longstanding standard for identifying securities for cross-border trading and post-trade processing — is facing an unlikely competitor, a proprietary code designed by commercial data giant Bloomberg. The 27-member board of directors of the Object Management Group (OMG), an international organization concerned with data integration standards, is set to […]
Merrill’s Reconciliation Fine: What Happens When Middle Office Fails
Reconciliation: it’s an everyday process in buy- and sell-side shops, where overworked middle-office analysts pay close attention to details and hope technology works. Like all post-trade operations, it often draws the attention of C-level executives only when something goes wrong. Even worse, as evidenced in a recent case involving Merrill Lynch, mistakes can also elicit […]
Asia-Pacific Post-Trade Operations: “Automation is Critical”
While Asia-Pacific is often touted as fertile ground for expansion by fund managers, broker-dealers and their asset-servicing providers, a range of bottlenecks remain in how trade details are acknowledged before settlement. In fact, Asia-Pac fund managers tell FinOps Report, newcomers may be surprised by additional operational and staffing costs to cleanup trades that don’t settle on […]
Middle Office Takes Center Stage in T+2
Once the unsung sibling of the front and back office, the middle-office could finally get its long overdue recognition as the US prepares to shorten its trade settlement cycle from three days to two. Squeezed between traders praised for making lucrative deals and operations experts at the end of the line moving cash and securities around to meet settlement obligations, […]
“Let Us Do It”: Data Utilities Target Mid-Office Data Drudgery
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 […]
Proxy Season: More Work For Less Money?
US broker-dealers and banks responsible for distributing proxy materials to beneficial shareholders might have reason to be unhappy this proxy season. Not counting all the overtime they will have to do to ensure their “street name” investors receive proxy materials, financial intermediaries might just get paid a lot less to do so. The Securities and […]
EMIR: One Little Number Can Make or Break Reporting
With the European regulatory requirements for reporting exchange-traded and over-the-counter swap transactions less than a month away, fund managers can’t afford a leap of faith that they will be ready, warn regulatory and operations experts. There is a key nagging issue they must resolve before February 12: just who will create the 52-character unique trade […]
ISITC Takes on Middle Office Ops
Best known for setting workflow standards for back-office communications between fund managers and custodians, the International Securities Association for Trade Communication (ISITC) is adding the middle office to its agenda this year. “It’s a significant area of operational risk,” says Jeff Zoller, who has just begun his two-year term as chairman of ISITC and is […]
Middle Office Takes Center Stage in Hedge Fund Valuation Fiasco
A recent fine of US$9 million the US Securities and Exchange Commission levied against a UK hedge fund advisor and its former US holding company shows the operational risk faced by alternative investment funds when middle-office controls fail to correctly handle the signs of a bad valuation. The settlement, announced on December 9, 2013 arose […]
FCA Leaves Asset Owners to Self-Police Custodian Fees
In deciding not to monitor the fees charged by UK custodians for some value-added outsourced services, the UK’s securities watchdog may have just opened a floodgate of lucrative business for third-party consultants. A new committee just established by the UK fund management trade group Investment Management Association (IMA) along with fund managers and custodians is […]