Citi has signed up to pilot the use of XBRL for corporate actions in a bid to improve straight-through processing in the paper-prone events information market.
Last year XBRL US, the Depository Trust and Clearing Corporation (DTCC) and Swift teamed up to explore using the language to reduce corporate actions' cost and time and improve data quality.
The partners published a business case in May and have developed an XBRL taxonomy based on the ISO 20022 standard, which is scheduled for an early October release for public review, testing, and comment.
Now Citi has begun working with XBRL US Labs and other, unnamed, participants on a pilot to test the premise that the use of structured, computer-readable data can streamline the process and introduce STP.
An impact analysis will be conducted on the issuance of XBRL-tagged announcements, processing by banks, depositories, and stock exchanges, and on the ultimate usability of corporate event data by information consumers, particularly shareholders.
The focus will initially be on tests on dividend announcements issued by American Depositary Receipts (ADRs), which were chosen because corporate actions announcements from them are concentrated among a relatively small number of depositary banks, and rely on significant hard copy transmittals and re-keying.
The pilot will use the XBRL ISO 20022 taxonomy, or dictionary, to create XBRL-formatted documents that will be used directly by downstream users.
Alan Smith, COO, Citi Securities and Fund Services, says: "As a market leader and early adopter, we will look forward to welcoming other institutions to help standardise financial information and achieve true straight-through-processing and benefit our customers, the recipients of these event announcements."