An apt term for eliminating faxed trades and getting closer to fully automated trade settlement. Although the term was recently used by one of the large custodian banks, its clear that all of the counterparties - from manager to broker to custodian to clearing corporations – need to adhere to this mantra. How close are we as an industry at straight thru processing (STP)? Considerable progress has been made in both Canada and the U.S. but still the rates are alarmingly low.
The Canadian Securities Administration (CSA) has introduced National Instrument 24-101 on institutional trade matching and settlement which takes affect on April 1, 2007. The rule calls for a transition from 80% of trades to settle on T+1, by Q4 of this year, to 95% of trades to settle on T, by Q1 2010. There are numerous milestones along the way, including exception reporting to the regulatory bodies by October of this year.
Although the U.S. does not currently have a NI 24-101 equivalent, the goals are similar. And the challenges are equally daunting for managers and broker/deals alike.
SSCNet is leading the way in North America and abroad by guiding firms through the steps required to reach end of day settlement. With experienced staff in the post trade settlement arena and real-time, message-based electronic trade settlement systems, SS&C is a leader in this field. With over 90% of the traffic between manager and custodians, SSCNet (formerly FMCNet) processes over 1,000,000 transactions per month. A single pipe to the outside world, SSCNet is what firms today need in order to "axe the fax" on the road to end of day trade settlement.
Adding SSCNet to your post-trade environment is a great way to add new levels of automation and risk reduction without the expected levels of overhead and effort. If you would like to learn more about SSCNet post-trade communication service now, schedule a demonstration, then contact us for a complimentary review.