DTCC And Banks To Develop Reference Data Service

Terry Flanagan

The Depository Trust & Clearing Corporation (DTCC) has signed a memorandum of understanding (MOU) with a group of large global banks that includes Barclays, Credit Suisse, Goldman Sachs and JPMorgan Chase and others to jointly develop a comprehensive service to collect and manage client entity reference data necessary to meet regulatory requirements and other normal course of business activities.

The parties to the MOU expect to have a state-of-the-art client data and documentation platform leveraging significant design work already undertaken in partnership with a broad group of major sell-side and buy-side firms globally.

More immediate interim releases will be provided to address specific regulatory needs. Over time, the service will address client reference data requirements of banks and broker dealers, as well as asset managers and hedge funds, including, among other items, legal entity hierarchies, standing settlement instructions (SSIs), regulatory compliance data (Dodd-Frank, Emir, etc.), client on-boarding/KYC, Tax/FATCA and other requirements.

“Our ultimate aim is to support the industry’s call for a comprehensive, centralized platform to effectively manage virtually all client reference data,” said Michael Bodson, DTCC president and CEO. “We are very pleased that we now have an MOU with a group of the industry’s top multinational participants. With their partnership, and the support of our Board of Directors, we are moving forward aggressively to bring this solution to market.”

By developing standardized processes and data formats in cooperation with market participants and the regulatory community, the parties to the MOU aim to effect substantial improvements in the control environment surrounding client onboarding and to streamline supervisory examination of these processes.

The service will benefit from DTCC’s broad experience in implementing extensible and scalable data platforms and operational processes, and will build upon its current and growing suite of industry-owned reference data assets, which includes Avox, its leading data validation operation that maintains cleansed publicly-available reference data for the service, and Omgeo ALERT, a standing settlement instruction database that contains the majority of the standing settlement instructions used by both buy- and sell-side market participants today.

“We are very excited to be a part of this joint initiative. Client service is of utmost importance to Credit Suisse, and the enhanced client reference data resulting from this service offering will assist us in meeting client needs,” said Colin Hall, Credit Suisse chief data officer, Investment Banking. “We firmly believe that our collaboration with the DTCC and other peer firms has the opportunity to deliver significant benefits to the broader market from control, regulatory and client service perspectives.”

Omgeo, a post-trade subsidiary of DTCC, plans to establish a user-governed global repository to store and communicate the “golden copy” of standing settlement SSIs for all products and geographies. This undertaking is part of an overall effort to standardize and centralize key client reference data functions and place them under user governance.

Omgeo ALERT, a database for the maintenance and communication of SSIs, will serve as the foundation for this service. ALERT will be the industry-wide SSI repository and communication hub, coordinating and distributing SSIs between trade counterparties and supporting settlement across all markets and asset classes globally.

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