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A Holiday for Corporate Actions

A friend of mine once quipped "Welcome to the Hotel Corporate Actions. You can check out any time you like, but you can’t never leave".  It was right on the money.  The word "dedicated" doesn’t even come close to describing the endless pursuit of automation by a relatively small group of Asset Servicing professionals.  

We’ve made enormous strides since the introduction of the ISO 15022 MT56X-series messages in 1998, and yet corporate actions operations in most banks remain stubbornly inefficient.  

Not to be deterred, organizations such as the DTCC, ISITC, and the SMPG continue to push hard.  These groups are borderline fanatics in their relentless quest for STP.  Every year the 56X messages are consistently amongst those with the most number of changes in the annual SWIFT release.  2015 was shaping up to be no different.  

Since my last blog, just before the country vote, there were 30 changes on the dock for the five message types in the group. For most banks, asset managers, and vendors there is most likely a grudging acceptance of this endless cycle.  "It is what it is", but at least it is reasonably predictable, so resources and budgets can be allocated accordingly.

So, imagine my surprise when I took at peek at the Updated High Level Information document published by SWIFT on November 21st.   No changes to the 56X messages.  What??  Surely this must be a mistake. 

Apparently not.  It seems that the Corporate Actions folks have given themselves a holiday!  All 30 changes have been postponed to a later date.

Curious.

What is going on here?  Well, since the 2012 release all changes to the MT56X messages are also applied to the corresponding ISO 20022 MX messages.  For a growing number of banks who are implementing the 20022 corporate actions messages this is making an already painful process twice as big. 

Perhaps somebody with a big enough stick has piped up and challenged the status quo. "Enough already.  This can’t go on." 

No matter how the decision was made, we now get to take a break for a year.  It’s a double-edged sword of course.  ISITC and the SMPG will not simply down tools.  The number of changes in next year’s release could easily be in the 50-60 range.  Yikes! 

I can’t help thinking about the glorious opportunity that now presents itself.  Can we turn this mini-break at the Hotel Corporate Actions into a permanent vacation?

Are there any banks here among us brave enough to say no to any more changes to the MTs?  It will only take two or three forward-thinking banks to take the lead here, and the rest will surely follow. 

Going forward, all maintenance on corporate actions messages will apply to the MXs only.  

You heard it here first.

 

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Steve Goswell

Steve Goswell

TBA

TBA

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San Francisco

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Standards Forum

The Standards Forum is the place where business and standardisation meet. This group would like to facilitate and encourage dialogue around standardisation in the financial industry, and share views, insights and updates on how financial standards can contribute to reducing cost and increasing efficiency when tackling today's challenges such as automation, compliance, and regulation.


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