BearingPoint Debuts SFTR-Reporting Module

Management and technology consultancy BearingPoint has expanded its ABACUS/Transactions software with a new Securities Financing Transactions Regulation (SFTR) module. Regulation (EU) 2015/2365 aims to curb systemic stability risks through increased transparency requirements, and BearingPoint’s SFTR module helps institutions comply with the new reporting obligations regarding securities financing transactions (SFT).

The European Commission approved the final implementation standards of the European Securities and Markets Authority (ESMA) on December 13, 2018. The Technical Standards, documented in the ESMA’s Final Report ESMA70-708036281-82, are set to be published in the Official Journal of the European Union, following the ongoing approval period of the EU Parliament and Council. Reporting requirements under SFTR will be introduced in several phases for different counterparty classes. The market players, starting with credit institutions and investment firms, are expected to be facing new complex reporting obligations from Q2/2020.

“Market actors tend to underestimate the complexity drivers,” said Bodo Windmoeller, BearingPoint’s Chief Product Officer RegTech. “Myriad regulations make financial services increasingly complex and costly. Reporting institutions can rely on the various ABACUS/Transactions modules to reduce the negative effects of the ever-increasing regulatory requirements. Our tried-and-tested solution already supports various types of transaction-based reports, ranging from EMIR, FMIA/FinfraG, CSA and MMSR to MiFID II/MiFIR, and now, SFTR. Our clients can make the most use of synergies along the regulatory value chain.”

The reporting scope under SFTR has been defined by the ESMA in the form of Technical Standards (RTS/ITS) with detailed specifications regarding SFT reporting, data collection and availability. The reporting obligation applies to repurchase agreements, buy/sell backs, securities/commodities lending and margin lending trades.

As a “sister regulation,” SFTR closely resembles the European Market Infrastructure Regulation (EMIR). Article 4 of the SFTR requires financial, non-financial and central counterparties in the EU to report each new, modified or terminated securities financing transaction to an authorized trade repository (TR) by the end of the following business day.

Alexander Becht, Product Manager for ABACUS/Transactions at BearingPoint, explained: “We have already adopted the established EMIR reporting logic and infrastructure within our SFTR module, enabling the automatic generation and submission of reports to the trade repositories from within the solution. ABACUS/Transactions has been in use since 2014 and has become well-established in the market, with renowned clients in seven countries successfully using the software to comply with several transaction-based reporting schemes.”

SFTR bridges the existing gaps with regards to securities financing markets, introduces comprehensive transparency requirements for investment fund managers (UCITS and AIFMD), and establishes requirements for the further utilization of collaterals provided.

Further information can be found on https://www.bearingpoint.com/en/our-expertise/innovations/regulatory-risk-tax-reporting-technology/.

Related articles

  1. Trade Reporting In Focus

    The GIPS standards, created by CFA Institute, are for calculating and presenting investment performance.

  2. The CDM establishes a single digital representation of trade events.

  3. FSB highlights trade reporting problems
    From The Markets

    REGIS-TR Partners with Reg-X

    The partnership programme eases the burden of European reporting obligations.

  4. Final phase of Singapore’s derivatives trade reporting requirements take effect on 1 October.

  5. No single bank in Capco's review produced a perfect TCFD disclosure.