SimCorp has joined forces with J.P. Morgan Securities Services to create a front-to-middle office custody integration, in order to overcome investment operations challenges, including post-trade processing for mutual clients.
The integration aims to tackle the costly and fragmented investment processes that contribute to operational risk, such as high settlement trade failures seen in recent months.
With heightened market conditions and low margins continuing to dominate institutional investment, asset managers and asset owners are faced with a plethora of operations challenges, says SimCorp.
In addition, the European Securties and Markets Association (ESMA) continues to record a higher than usual rate of trade settlement fails, as the market volatility seen in 2020, put a spotlight on the inefficient and heavily manual processing buy-side firms experience today.
To reduce the risk and cost of manual and disjointed operations as well as to address the complexities of a remote workforce, many institutions are now looking to rationalise operations.
Automating workflows and increasing data transparency in post-trade processing has become a natural starting point,
As part of the deal, SimCorp’s software-enabled services and J.P. Morgan Securities Services will provide interoperability and transparency in the front office, middle office and custody.
The sharing of intra-day, multi-asset data will enhance key investment workflows from tax reclaims to proactive risk management of unprocessed trades, delivering improved automation and user experience.
Meanwhile, augmented exception commentary will provide compliance teams with greater context, indicating action ownership for faster settlement, reducing the number of failed trades in the market today.
“As we move towards a diverse and connected future, opening up our architecture and creating an open ecosystem will facilitate the buy side with more flexibility in their operations,” says Marc Schröter, senior vice president, global product management at SimCorp.
He adds, “The value created in these partnerships, goes beyond data and operations, delivering reduced cost and risk, while importantly supporting investment decision making and optimising operational agility for our clients.” Schröter notes.
Naveen TV, managing director in securities services, J.P. Morgan, notes, “The integration with SimCorp enables mutual clients with seamless data delivery across both SimCorp Dimension and J.P. Morgan’s Securities Services.”
“By sharing enriched transaction data sets and operational workflows within an open integration, we firmly believe that the flexibility this delivers, combined with our joint capabilities, will greatly benefit clients in their quest for efficient and transparent operations,” TV adds.
©Markets Media Europe 2021