Misys Banking Systems, a global leader in banking software and solutions, announces today the launch of a real-time interface to The Depository Trust & Clearing Corporation (DTCC) Deriv/SERV automated matching and confirmation service for over-the-counter derivatives. The interface will enable Misys Summit FT customers to automate confirmation matching with counterparties and thereby helps to reduce operational risk, improve straight-through processing and streamline the whole derivatives trading process.
The growing use of derivatives as financial instruments has brought industry-wide challenges. In Europe, the volume increase has been exacerbated by UCITS III creating a huge influx of market participants on the buyside. The lack of automated processes for derivatives in this sector has significantly impacted STP and operational risk. As the market gears itself up to handle the increasing volumes and complexity of these trades, the challenge is to ensure both the buy and sell side are moving their technology requirements at the same pace and maintaining expected standards of STP.
The interface to DTCC Deriv/SERV will help Misys Summit customers to address these issues. It automatically sends and receives confirmations from DTCC Deriv/SERV in both real-time (via IBM MQ Series & FpML) and flat file modes, integrates these within the Misys Summit cross-asset STP environment, booking trades, producing confirmations and tracking in real-time the status of acknowledgements - handling all related settlements, exceptions, collateral and accounting for each trade.
Speaking on behalf of Misys Banking Systems, Dan Cohen, product manager for Misys Summit FT, commented, "Misys Summit FT has an impressive pedigree in derivatives technology that has evolved over the last 16 years. In the next couple of releases we are enhancing our credit derivatives functionality to elevate the solution to a new level of sophistication, offering our customers the technology to handle the complex derivatives of today and those of tomorrow. DTCC Deriv/SERV is recognised as the largest electronic matching and confirmation service for credit derivatives, and we are therefore very pleased to be working in partnership with DTCC to help the market handle increased volumes of complex trades. These conditions demand software that can offer a sound STP offering as well as minimising confirmation and matching times.
"At a time of derivatives market growth for vanilla and OTC complex trades, our solution will give Misys Summit FT customers a distinct market advantage," he concluded.
"DTCC is committed to bringing greater efficiency to the market by providing market participants with the option of one-stop, electronic processing throughout the lifecycle of an OTC derivatives product," said Bill Hodgson, vice president, DTCC Business Development. "By collaborating with complementary service producers like Misys we are helping bring to the marketplace better access to the benefits of automation"