Spring 2016 Edition

  • 894

    MiFID II & MiFIR: reporting requirements and associated operational challenges

    While the key objectives of Markets in Financial Instruments Directive (MiFID) I were to bring greater standardization and improvements in collateralization and risk management, MiFID II seeks to enhance transparency and supervision to ensure methodical markets and harmonize reporting requirements across member states. In this article, Mahima Gupta and Shashin Mishra summarize the obligations MiFID II imposes upon investment firms and explore the associated impact and operational challenges, some of which can be effectively outsourced to a vendor system. Download the PDF MiFID I came into effect in 2007 to facilitate cross-border financial services within Europe, ensuring a competitive landscape [...]
  • 900

    THERE IS NO SUCH THING AS HARMONIZATION: so let’s get good at translation

    With another major regulatory reform bearing down on the financial services industry, organizations are realizing that a one-size-fits-all data reporting solution is out of reach. However, with the right approach, firms have the opportunity to become more nimble around the growing list of regulations and establish a competitive advantage. In this article, Randall Orbon, Brian Lynn and Mahima Gupta explain why firms need to shift their mindset from the idealistic quest for a universal industry standard to one that focuses on enabling message translation in the most efficient way possible to avoid regulatory scrutiny and reduce costs. Download the PDF [...]
  • 910

    ASSET MANAGEMENT METAMORPHOSIS: transform now or risk missing the greatest opportunity in decades

    Many asset management firms are implementing customer relationship management (CRM) systems to automate their sales and marketing processes and build more comprehensive views of their customers. Likewise, many are building interactive client portals and applications, as well as client reporting and document automation capabilities, to better service customers, create operational efficiencies and meet regulatory reporting requirements. As a next step, asset managers can devise a strategy to share the information generated by these customer-facing portals and apps with their CRM systems, and vice versa, to proactively engage the customer on an increasingly personalized level. In this article, Thomas Kracz discusses [...]
  • 923

    STATE OF DATA GOVERNANCE: the challenge to make data management programs operational

    Data management is gaining stronger traction across the financial services industry thanks to stringent regulatory requirements, such as BCBS 239. However, with increasing regulatory demands comes the issue of sustainably operationalizing data management programs. In this article, Gavin Kaimowitz outlines the challenges firms face when rolling out these programs throughout their entire organization and the steps needed to achieve operational success that enables a path to growth and greater revenue. Download the PDF Global financial institutions are coming to the realization that the business processes and operational models they have relied on in the past won’t necessarily help them succeed [...]
  • 984

    MISMO: data standardization in the age of housing finance reform

    The burst of the housing bubble in 2007 brought a wave of change in the US residential mortgage market. From tighter underwriting standards and stricter disclosures per regulatory guidelines in the primary market to a secondary market placed under conservatorship, organizations across the entire industry have had to adapt to this changing paradigm. Regulators, borrowers and investors are seeking more transparency in hopes of preventing a second mortgage crisis. In this article, Jocelyn St. James discusses the industry’s increased adoption of the Mortgage Industry Standards Maintenance Organization (MISMO) data standard, and how, by enabling market players to build upon a [...]
  • 962

    Silicon Valley Meets Houston: the emergence of collaboration in energy markets

    Business utilities, a new breed of company in the energy market, are poised to tackle severe inefficiencies that have plagued the sector for decades. Energy players that recognize the potential of these emerging models can, and will, wield a competitive edge. But are large energy companies standing in their own way? In this article, Rashed Haq highlights how the energy markets can take inspiration from Silicon Valley to establish collaborative business models that unlock unimaginable opportunities. Download the PDF In today’s energy marketplace, businesses are feeling intense economic and regulatory pressure on many fronts. There is pressure in terms of [...]
  • 951

    INVESTMENT BOOK OF RECORD: improving decision support and transparency in an increasingly complex environment

    Rapid technology innovations during the past few years are disrupting business models within the financial services industry that have largely remained untouched for decades, challenging operational processes and rendering traditional architecture options suboptimal. With increased regulation stemming from the global financial crisis and competition from new financial services providers, leveraging innovation in the quest for alpha is now a necessity for buy-side firms. In this article, Joshua Satten and Sidhartha Adholekar outline why the Investment Book of Record (IBOR) is critical to empower operational and investment process functions. They also address why an IBOR is equally beneficial to funds, fund [...]
  • 938

    BULK NOVATIONS: addressing the five key challenges

    With new, tighter regulations driving capital markets firms to fundamentally transform their business models, many have turned to bulk novations in response to the structural reorganization of their legal entities as their portfolios are repositioned. But several issues have emerged throughout the bulk novation lifecycle, leading to inefficient transfers and undesirable risk exposure. In this article, James Bakelmun, Nick Fry, Sarah McLellan and Nathan O’Reilly outline these challenges and explain what firms can do to migrate their portfolios more efficiently and mitigate their operational risk or potential reputational damage. Download the PDF In the financial markets, novations—the act of legally [...]
  • 924

    EMRR: a crucial component to successful risk management

    Exceptions, or processing failures due to erroneous data, are a daily occurrence for market participants as they fulfill their regulatory reporting obligations. However, as regulators seek more granular data for over-the-counter (OTC) derivatives trading activity, exceptions are becoming more frequent and more complex. That’s driving the need for exception management in regulatory reporting (EMRR), which is the process of identifying, investigating and resolving conflicts during data reporting transfers. In this article, Basu Bishal and Rohit Narula explain why EMRR should be a component of every trading firm’s risk management system and how effective implementation can minimize compliance costs while freeing [...]