Euroclear to launch automated processing platform for French fund market
05 July 2005 | 1417 views | 0
Source: Euroclear France
Euroclear France has received market approval to develop a comprehensive, automated processing solution for the investment-fund sector in France, Europe's largest domestic fund market.
This new Euroclear initiative represents an important part of a broader strategy that will ultimately be rolled out across the other central securities depositories (CSDs) in the Euroclear group.
Due for launch during the first quarter of 2006, the new service will combine the order-routing functionality of FundSettle – Euroclear's cross-border fundprocessing platform – with the custody and settlement services of RGV/Relit+, Euroclear France's state-of-the-art securities processing system. This will enable the French CSD to offer a fully integrated fund-processing solution, allowing investment-fund transactions to be processed on a straight-through basis for the first time in France.
The initiative has been developed in close consultation with Euroclear France's users and with two of the country's leading trade organisations, AFTI (the Association of Financial Intermediaries) and AFG (the French Asset Managers Association).
Commenting on today’s announcement at Fund Forum 2005 in Monaco, Brigitte Daurelle, Director of Product Management, Euroclear SA/NV Paris, said: "This novel solution for the French funds market could not have been developed without the full support of our users, with whom we have been working very closely. It will enable us to offer a full STP service for French investment funds, from order routing through to custody and settlement, thereby reducing considerably the risks and costs currently associated with the manual processing of fund transactions."
Bruno Prigent, moderator of AFTI's depository working group, added: "An automated order-routing system linked to Euroclear France’s own custody and settlement infrastructure will greatly help to improve the competitiveness of France's fund sector and to promote more widely the CSD model for fund processing in Europe."
With an estimated 5,000 orders transmitted per day, third-party fund distribution in France grew by 20% in 2004. Over the next three years, annual growth rates are expected to be in excess of 10%. As a consequence, automation of the order-routing process is one of the French fund industry’s top strategic priorities. Benefits include significant reductions in the costs and risks associated with existing manual processes (primarily via fax and phone), and improved service levels for investors and fund promoters alike.