Claimonitor, a new ASP-based straight-through processing utility for automating transactions and market-related claims in the global custodian, investment banking, asset management and broker communities, is preparing for a live launch next month.
The new post-trade utility - developed by Claimonitor Ltd in conjunction with technology partners, Sun Microsystems, Oracle and Metatomix - has already won the backing of HSBC, State Street Bank and Trust and industry standards body Isitc.
Stuart Mckinlay, vice president at State Street Bank and chairman of Isitc Europe, says the Claimonitor initiative picks up on Isitc Interest Claims working party findings. "This is a significant area of investigation for our technology sub-committee," he says. "In this respect, we are highly supportive of these initiatives. The parties involved clearly listened to our stated needs and addressed the issues we raised."
Currently, settlement errors cost the market millions of dollars from interest and process expenses. In addition, claims are often handled manually and, without any audit trails or receipts, leave room for dispute. As a result, the cost of recovery can be higher than the claims themselves, so organisations don't always pursue them. The new utility is designed to eliminate the costly investigation, processing and storing of documents related to claims disputes.
"This area of our trade processing activity was previously manually intensive, prone to errors and wrought with time delays," says Richard Cato, senior manager for operations at HSBC. "With Claimonitor, we see a valuable new service to increase efficiency, reduce costs and remove an area of systemic risk in the way the operations currently work."
Developed on x64 Sun Fire servers, the new service is fully hosted and run by Sun’s Managed Services Division. The utility is built on Metatomix's ERI MTX data management and visualisation platform and uses an Oracle 10g database for historical transaction reporting.
Post-trade events handled by Claimonitor include interest claims arising out of failed cash payment, FX, and securities transactions and interest due on over-draft balances of cash or nostro accounts. In addition, system functionality will allow for handling securities market buy-ins, market fines, and also securities dividend and stock entitlements arising from corporate action events on failing and open stock loan and borrow transactions.