Omgeo, global standard for post-trade efficiency, in partnership with the Chilean central depository, Depósito Central de Valores, S.A. (DCV), today jointly announced the Chilean Securities and Insurance Supervisor (Superintendencia de Valores y Seguros, or SVS) has authorized the implementation of their joint trade matching service, effective 20 July 2012.
The solution, which is currently in testing with a number of clients, connects Omgeo Central Trade ManagerSM (Omgeo CTM) to DCV, enabling brokers to access the central matching benefits of Omgeo CTM via DCV's institutional delivery system, SADE.
Omgeo CTM is a strategic platform for the central matching of cross-border and domestic equity, fixed income, exchange-traded derivative and contract for difference transactions. The goal of Omgeo and DCV's joint matching solution is to automate the matching process in the Chilean markets, ultimately reducing the risk of trade failure in the region.
DCV applied to the SVS for approval on the joint offering earlier this year, and after conducting a rigorous review of the information presented and testing the systems and procedures of the service, the SVS elected to authorize the offering.
According to a recent Omgeo whitepaper, failed trades could put upwards of USD$970[i] billion in equity transactions and USD$300 billion in fixed income trades at risk globally each year. The study also identified that a key obstacle hindering trade settlement is inadequacy in trade "matching," or the process by which buyers agree with sellers on what they have bought, in what quantity and at what price.
Fernando Yañez, CEO of DCV, said, "The SVS's approval of this solution will help DCV market participants reduce settlement risk by enabling automated communication with trade counterparts globally. By improving the efficiency of our markets, Latin America's role in the global marketplace will only continue to increase."
Tim Keady, managing director of sales and solution delivery at Omgeo, said, "Efficient matching is critical to reducing risk. This link will enable market participants in Chile to leverage a global industry best practice — central matching via Omgeo CTM — from SADE, marking a key step toward increasing automation, lowering risk and improving post-trade processes in the market."
The launch of the new joint offering underscores Omgeo's commitment to increasing settlement efficiency and lowering risk across the global markets. In addition to the DCV, Omgeo also offers links from its services to the Depository Trust & Clearing Corporation (DTCC), Canadian Securities Depository (CSD), Korean Securities Depository (KSD) and Japanese Securities Depository (JASDEC).