Ten industry service providers have teamed up to develop an XML-based (eXtensible Markup Language) common standard for the securities financing industry data exchange.
The alliance includes two reconciliation service providers - Pirum Systems Limited and Syntegra; two risk management service providers - Reech Capital and Securities Finance Systems Limited; electronic marketplace provider - SecFinex; and five transaction processing service providers - Anvil Software Arts, Grips, OM OneWorld, Real Time Financial Management and SunGard Securities Finance Global ONE.
On behalf of the group, SecFinex has developed an initial draft standard, SFXL (Securities Financing eXtensible Markup Language), which aims to standardise the transfer of information on securities finance transactions. It is anticipated a common standard will make it much easier for companies to share and exchange data, thereby streamlining operations and increasing efficiency.
Future enhancements will encompass securities inventories and the post-trade servicing of securities finance actions such as trade matching, billing and marking to market.
SFXL will be an open standard, freely available to all service providers and participants in the securities financing arena. The draft standard is to be offered to FpML, the financial services industry organisation that oversees development of XML industry standards for the financial derivatives industry, say the vendors.
The ten service providers have agreed to incorporate these standards in their systems provided to securities finance customers.
Carol Kemm, director of SunGard Securities Finance (SSF) Global ONE, says: "We believe that the development of this standard will provide a positive step forward in facilitating greater efficiency, and associated cost savings, for many of the system integration issues faced today."
Malcolm Clark, from Anvil Software, adds: "Advanced industry players are connecting their front office trading and position management systems to electronic markets...The SFXL standard will ultimately make market-to-front office and front-to-back office integration so much easier."